Asian Stocks Drop

Asian stocks fell, capping a second week of declines, after Sanyo Electric Co.'s operating profit dropped and UBS AG cut its rating on shipping companies., Bloomberg 8/7/2008 7:56:55 PM

Sanyo, the world's largest maker of rechargeable batteries, and Mitsui O.S.K. Lines Ltd. slumped in Tokyo. Mitsubishi UFJ Financial Group Inc., Japan's No. 1 bank by market value, and advertiser Dentsu Co. retreated after the government said the country may be in a recession. Telecom Corp., New Zealand's biggest telephone company, fell the most in almost six years after net income dropped.

The MSCI Asia Pacific Index declined 0.6 percent to 127.30 as of 10:27 a.m. in Tokyo. For the week, the gauge has lost 2.6 percent. Japan's Nikkei 225 Stock Average sank 0.3 percent to 13,089.30. Most other benchmark indexes slid in the region.

U.S. stocks fell the most in a week yesterday, with the Standard & Poor's 500 Index losing 1.8 percent. American International Group Inc. plunged the most since listing in 1969 after reporting an unexpected loss, while Wal-Mart Stores Inc., the world's largest retailer, dropped after saying sales are likely to slow. Jobless claims in the biggest economy unexpectedly rose.

Japan's Cabinet Office said yesterday the economy ``may be in a recession'' due to slower growth in the U.S. Economists surveyed by Bloomberg expect gross domestic product figures set to be released next week to show that the world's second-largest economy contracted 2.3 percent in the April to June quarter.

The Baltic Dry Index, a measure of coal, iron ore and grain shipping costs, extended its losing streak to a 20th day, the longest string of declines since August 2005, amid concern demand in China is slowing.

Asian Stocks Drop