Asian stocks dropped with US index futures and emerging-market currencies as concern global growth is faltering spurred investors to sell riskier assets and seek the relative safety of government debt.
Australian shares headed for their steepest decline in almost a month, while all 10 industry groups on the MSCI Asia Pacific excluding Japan Index fell. Standard & Poor’s 500 Index contracts signaled a third day of losses after Federal Reserve members over the weekend talked up prospects for a 2015 interest-rate increase. Zinc declined with New Zealand’s dollar and emerging-market currencies, while Australian bonds rose a second day. Japanese markets are closed through Wednesday, Bloomberg reported.
The MSCI Asia Pacific excluding Japan Index sank 2%, the most in almost three weeks, in Hong Kong. S&P 500 futures dropped 0.3%. The S&P/ASX 200 Index tumbled 2.4% in Sydney, while the Hang Seng Index retreated 1.1% and Seoul’s Kospi gauge slid 1.5%. The kiwi slipped 0.7% after consumer confidence dropped to a three-year low, while the Korean won and Malaysian ringgit weakened at least 1%.
Yields on Australian and New Zealand 10-year debt dropped by at least three basis points. US oil was at $45.14 a barrel, while copper fell 0.3% in London, extending Friday’s 2.5% slump.
Futures now give just a 20% chance of a rate increase at the Fed’s October meeting, and 46% probability of a move in December.
Stocks & Bonds
Just 13 of the 200 stocks on Australia’s main index advanced, the fewest since Sept. 10. Banks and raw-materials producers were the biggest drags.
Hong Kong’s Hang Seng Index was lower after capping its first back-to-back weekly gains since May. The Hang Seng China Enterprises Index, a gauge of mainland stocks listed in the city, sank 1.8% after finishing Friday at its highest since Aug. 21.
The Shanghai Composite Index swung between gains and losses. China Railway Group Ltd. jumped 6.5% after it said it will inject industrial manufacturing units into China Railway Erju in exchange for assets.
Yields on 10-year Australian notes fell five basis points, or 0.05 percentage point, to 2.72% in a second day of declines. Rates on similar maturity New Zealand debt slipped four basis points to 3.28%.
Commercial petroleum stockpiles in Saudi Arabia, the world’s biggest crude exporter, increased to 320 million barrels, the highest since at least 2002, according to data Sunday on the website of the Riyadh-based Joint Organizations Data Initiative. Venezuela and Saudi Arabia agreed to restore stability in the oil market, Foreign Minister Delcy Rodriguez said on Twitter over the weekend.
Elsewhere in commodity markets, copper for three-month delivery dropped to $5,246 a metric ton, while nickel advanced 1.1%. Other industrial metals declined, with zinc and lead falling at least 1.1%. Gold for immediate delivery slipped 0.1% to $1,137.92 an ounce following a weekly advance of 2.8%.
