ASIAN stocks fell for a second day, led by financial companies, on speculation widening credit-market losses will sap earnings.
Commonwealth Bank of Australia, the nation's largest bank by market value, and Westpac Banking Corp slumped in Sydney after UBS AG said the companies may set aside more money to cover bad debt. Toray Industries Inc, a synthetic fiber maker, tumbled in Tokyo after the Nikkei newspaper reported the company may say profit declined. BHP Billiton Ltd climbed to its highest this year on speculation China will buy a stake.
The MSCI Asia Pacific Index lost 1.1 percent to 142.73 as of 4:28pm in Tokyo. All 10 of its industry groups fell, with a measure of finance stocks contributing 45 percent of the decline. The regional gauge is down 9.6 percent this year amid concern losses related to United States subprime mortgages will widen, Bloomberg News said.
Huge problem
"The subprime problem is huge," said Hans Goetti, who oversees US$10 billion in assets as chief investment officer at LGT Bank in Singapore. "Just take a look at the amount of the writedowns and it seems it's wishful thinking to say the market has seen the last of the fallout."
Japan's Nikkei 225 Stock Average fell 1.1 percent. Obayashi Corp led building companies lower after reporting profit that fell short of analyst estimates, while Tokyu Land Corp slumped after a cut in its rating. Most stock benchmarks in Asia retreated. South Korea was closed for elections.
The US Standard & Poor's 500 Index fell 0.5 percent on Tuesday. S&P cut the ratings of the country's three largest mortgage insurers on Tuesday because losses from the slump may extend through next year. Mortgage losses may hit US$1 trillion, the International Monetary Fund said.
Commonwealth Bank dropped 3.1 percent to A$41.85 (US$38.89). Westpac fell 1.6 percent to A$23.17.