Asian Stocks Decline on U.S. Retail Sales, Yen; Advantest Falls

April 15 (Bloomberg) -- Asian stocks dropped for the first time in five days after U.S. retail sales unexpectedly declined and the stronger yen dimmed the earnings outlook for Japan’s electronics and auto companies.

Canon Inc., which generates more than half of sales from U.S. and Europe, declined 2.6 percent in Tokyo as the yen rose against the dollar and the euro. Advantest Corp., the world’s biggest maker of equipment used to test memory chips, sank 2.6 percent after Intel Corp., the world’s largest chipmaker, reported lower earnings.

“The situation in the U.S., combined with the stronger yen, point to losses in the local market today,” said Hiroichi Nishi, general manager at Nikko Cordial Securities Co., in an interview with Bloomberg Television. “From a technical perspective, investors may be thinking now is a good time to sell.”

The MSCI Asia Pacific Index lost 0.6 percent to 89.00 at 10:01 a.m. in Tokyo, snapping a four-day, 5.6 percent advance. The gauge rallied 26 percent from a five-year low reached on March 9 amid speculation government stimulus efforts worldwide will succeed in easing the global financial crisis.

Japan’s Nikkei 225 Stock Average dropped 0.9 percent to 8,761.24, while South Korea’s Kospi index fell 0.6 percent. All markets open for trading declined except Australia.

Futures on the U.S. Standard & Poor’s 500 Index dropped 0.6 percent. The gauge slid 2 percent yesterday after the government said the country’s retail sales fell 1.1 percent in March, compared with the 0.3 percent increase economists in a Bloomberg survey had estimated. Prices paid to U.S. producers dropped 1.2 percent, a separate government report showed.

‘Economic Progress’

President Barack Obama said yesterday that his economic- stimulus package and plans to rescue banks and bolster housing are starting to “generate signs of economic progress.” Still, he warned of “pitfalls” ahead.

Canon, the world’s largest maker of digital cameras, fell 2.6 percent to 3,030 yen in Tokyo. Toyota Motor Corp., the world’s largest automaker, lost 0.5 percent to 3,780.

The yen climbed to as high as 98.74 against the dollar from 99.79 at the close of trading in Tokyo yesterday. Japan’s currency gained as much as 2.1 percent versus the euro. A stronger yen erodes the value of sales generated overseas.

Advantest dropped 2.6 percent to 1,543 yen after Intel said first-quarter profit fell 55 percent because of slowing computer demand and signaled sales won’t recover in the current period. Intel shares lost 5.6 percent in extended trading.

Samsung Electronics Co., the world’s largest maker of computer-memory chips, dipped 1 percent to 569,000 won in Seoul.

The MSCI Asia Pacific Index’s rally in the past five weeks has driven the average valuation of companies on the gauge to 18 times reported profit, the highest since Nov. 7, 2007.