Asian stocks decline in early trade; Nikkei sheds 0.7%

Investing.com | Author

Published Oct 19, 2011 10:08PM ET

Investing.com - Asian stocks moved lower in Thursday trade, pulled down by the overnight downturn on Wall Street and ahead of a highly anticipated summit of European leaders aimed at tackling the region’s debt threat.

During early Asian trade, Hong Kong’s Hang Seng Index declined 0.61% to 18,198.10, Japan’s Nikkei Index fell 0.73% to 8,708.27, while Australia’s S&P/ASX 200 retreated 1.62% to 4,145.50.

The Topix Index of all shares listed on the first section of the Tokyo Stock Exchange, lost 0.63% to trade at 746.77.

In its Beige Book survey released Wednesday, the Fed said, “Overall economic activity continued to expand in September, although many districts described the pace of growth as modest or slight. Contacts generally noted weaker or less certain outlooks for business conditions,” the report said.

Elsewhere, the U.S. Census Bureau reported that housing starts totaled 660,000 in September, the highest level in 17 months, outstripping market expectations of a 590,000 rise.

Wall Street erased modest morning session gains following release of the Beige Book, ending Wednesday lower; The Dow Jones Industrial Average lost 0.63%, the Nasdaq Composite Index fell 2.01%, and the S&P 500 declined 1.26%.

Earlier Wednesday, the U.S. Bureau of Labor Statistics reported that the core consumer price inflation index rose less than expected last month, up 0.1% in September from 0.2% in August, the smallest increase since March.

Economists had forecast the index to rise by 0.2% during the period.

Meanwhile, French President Nicolas Sarkozy was scheduled to fly to Frankfurt for a meeting with German Chancellor Angela Merkel, International Monetary Fund head Christine Lagarde and other officials ahead of the summit of euro-zone leaders on Sunday.

European finance officials continue to debate details of a plan to boost the strength of the European Financial Stability Facility, the regional rescue fund for debt threatened euro-zone nations.

Australian mining company Rio Tinto Ltd. fell 2.8% after announcing it would be buying Canada’s Hathor Exploration Ltd. for USD576 million.

Australian mining issues, as a whole were among the weakest issues in Sydney, with BHP Billiton Ltd. down 2.1% and Newcrest Mining Ltd. slumping 5.6%.

Panasonic Corp. lost 0.2% after a Japanese daily reported the company would be downsizing its television production division and closing one its plants in suburban Tokyo.

Technology issues in the Japan mirrored losses from their Wall Street counterparts on the Nasdaq. Sony Corp fell 1.3%, Advantest Corp. retreated 1.5%, Kyocera Corp. was down 0.6% and Yahoo Japan Corp. lost 0.3%.

The outlook for European stocks was optimistic. France’s CAC 40 futures was higher by 0.05% to 3,125.20, Britain’s FTSE 100 futures added 0.13% to 5,373.40, while Germany’s DAX futures rose 0.15% to 5,861.90.

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Written By: Investing.com

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