Asian stocks fell, led by commodity and property companies, on concern a three-month rally had made shares expensive relative to earnings prospects.
Japan's Nikkei 225 gained 97.62 points, or 1% to begin the week at 9,865.63, while Hong Kong's Hang Seng nose-dived 426.14 points, or 2.3%, to 18,253.39.
Feng Hsin Iron & Steel Co., which last week rose to a more than eight-month high, lost 6.5% in Taipei. Cnooc Ltd., China’s largest offshore oil producer, sank 3.2% as oil prices retreated for a second day. Daido Steel Co. slumped 3.5% in Tokyo on a Goldman Sachs Group Inc. downgrade.
Sun Hung Kai Properties Ltd. fell 5.5%, leading declines among Hong Kong’s real-estate companies, the city’s best performing stocks in the past month.
Japan’s market climbed as a weaker yen boosted the earnings outlook for Canon Inc., which gets 28% of its revenue in the Americas. Komatsu Ltd., the world’s number-two maker of earthmovers, surged 6% after two brokerages recommended buying the stock.
South Korea’s Samsung Engineering Co. climbed 4.5% after Mirae Asset Securities Co. raised its share-price target.
In Taipei, Cathay Financial Holding Co., Taiwan’s largest listed financial- services company, slid 5%, paring its gain in the past month to 7.8%.
PetroChina Co., China’s largest oil producer, sank 2.5%. The drop followed three weeks of gains that took its relative strength index, a gauge of how rapidly prices have risen or fallen, above the 70 threshold some traders use as a sell signal.
Raw materials producers and energy shares are the best performing of the MSCI Asia Pacific Index’s 10 industry groups in the past month on optimism stronger economic growth will fuel demand for oil and metals.
In Hong Kong, Cheung Kong (Holdings) Ltd., Hong Kong’s number-two developer, lost 3.8%.
The Hang Seng Property Index fell 3.9% today, paring its advance in the past month to 13%. The measure is still the best performing of the benchmark Hang Seng Index’s four industry gauges in that period.
In Japan, Mazda Motor Corp., which exports about 80% of its production, surged 6.1%.
The yen traded at 98.64 per dollar after weakening to as low as 98.89 on June 5, a level not seen in a month, after U.S. payrolls data boosted demand for the country’s assets.
The U.S. Labor Department said on June 5 payrolls fell by 345,000 in May, compared with an average estimate for a decrease of 520,000 jobs in a Bloomberg survey of economists.
Stocks rose today even as a government report showed Japan’s current-account surplus narrowed in April as the global recession cut demand for exports. Japan’s former Economic and Fiscal Policy Minister Hiroko Ota said in a June 4 interview that the world’s second-largest economy is likely to stumble again later this year after a temporary rebound.
Komatsu, which gets more than a fifth of its sales in the Americas, jumped 6%. Morgan Stanley started coverage of the company with an "overweight" recommendation and Nomura Holdings Inc. upgraded the stock to "buy" from "neutral."
Nomura, Japan’s largest brokerage, gained 4.9% as it was raised to "overweight" from "equal weight" at Morgan Stanley.
In Seoul, Mirae Asset Securities lifted its target for Samsung Engineering’s share price to 117,000 won from 91,000 won and maintained its "buy" recommendation in a report today. Samsung Engineering submitted the lowest bids for four overseas projects, which should lead to orders, the brokerage said.
Elsewhere:
China’s Shanghai Composite Index gained 9.17 points, or 0.3%, to 2,948.48
Singapore’s Straits Times Index sank 62.65 points, or 2.6%, to 2,333.70
South Korea’s Kospi index lost 1.41 points, or 0.1% to 1,393.30
Taiwan’s Taiex stumbled 228.72 or 3.3%, to 6,628.02
New Zealand’s NZX 50 Index slumped 17.89 points, or 0.6% to 2,816.62
Australia’s S&P/ASX 200 had the day off
