Asian Stocks Decline for Third Time in Four Days on Europe, Yen

June 9 (Bloomberg) -- Asian stocks fell for the third time in four days as the stronger yen dragged down Japanese exporters and on concern Europe’s debt crisis will worsen after Fitch Ratings called the U.K.’s fiscal challenge “formidable.”

Nintendo Co., the maker of video-game consoles and which gets 85 percent of sales outside Japan, sank 4.7 percent. Nissan Motor Co., a carmaker that gets about 75 percent of its revenue outside Japan, slumped 3.3 percent in Tokyo. Canon Inc., a Japanese electronics maker that counts Europe as its biggest market, declined 1.8 percent.

“Market sentiment is very bearish,” said Prasad Patkar, who helps manage about $1.5 billion in Sydney at Platypus Asset Management Ltd. “Everyone is focusing on any bad news they can get their hands on. When the tide is so heavily bearish, any reason is used to sell off and any good news is ignored.”

The MSCI Asia Pacific Index fell 0.8 percent to 109.40 as of 1:23 p.m. in Tokyo, with almost twice as many stocks declining as advancing. The gauge has retreated 15 percent since this year’s high on April 15 on concern debt crises among European countries will undermine a global economic recovery.

The drop has cut the price of shares in the index to 14.1 times estimated earnings on average, near the lowest level since January 2009.

Japan’s Nikkei 225 Stock Average retreated 1.2 percent, the biggest decline among benchmarks in the Asia-Pacific region, even after a Cabinet Office report showed the nation’s machinery orders rose more than economists estimated in April.

Australian Confidence Falls

Australia’s S&P/ASX 200 Index slipped 0.2 percent. Consumer confidence fell in June for a third straight month after the central bank boosted borrowing costs six times since October, a survey by Westpac Banking Corp. and the Melbourne Institute showed.

South Korea’s Kospi index fell 0.3 percent. China’s Shanghai Composite Index gained 0.2 percent. Hong Kong’s Hang Seng Index slipped 0.4 percent.

Futures on the Standard & Poor’s 500 Index dropped 0.3 percent. The index rose 1.1 percent yesterday as a rally in commodity markets boosted oil and metals producers, overshadowing losses by semiconductor companies.

Nintendo lost 4.7 percent to 24,120 yen and was the most active stock by value in Japan. Nissan, the country’s third- largest automaker, slid 3.3 percent to 619 yen. Canon, the world’s biggest maker of cameras and office equipment, retreated 1.8 percent to 3,625 yen.

Honda Motor Co., a carmaker that gets 81 percent of its sales outside Japan, fell 3.1 percent to 2,614 yen and was the biggest drag on the MSCI Asia Pacific Index, followed by Nintendo.

Yen Hurts Exporters

Consumer discretionary stocks, which include exporters of cars and electronics, fell the most among the MSCI Asia Pacific Index’s 10 industry groups.

The yen strengthened to as much as 108.90 per euro today from 109.86 at yesterday’s close of Tokyo stock trading. Against the dollar, the Japanese currency rose to as much as 91.24 from 91.77. A stronger yen lowers the value of overseas income at Japanese companies when converted into their home currency.

The U.K. government needs to accelerate budget-deficit cuts to protect Britain’s top credit rating, Fitch Ratings said yesterday.

“The scale of the United Kingdom’s fiscal challenge is formidable and warrants a strong medium-term consolidation strategy -- including a faster pace of deficit reduction than set out in the April 2010 budget,” Fitch said.

‘Scary’ U.K. Situation

“I’m scared of the U.K.’s situation, particularly if it cuts the budget because the scale of its economy is significant enough to create a huge impact,” said Castor Pang, Cinda International Ltd’s research director in Hong Kong.

LG Electronics Inc., South Korea’s second-largest electronics maker, dropped 2.4 percent to 98,600 won after BNP Paribas SA reduced its rating on the company to “hold” from “buy.” The company’s profit margins in its liquid-crystal- display television business will be “vulnerable” to the weak euro, analyst Peter Yu said.

Mazda Motor Corp. declined 3.9 percent to 221 yen after the automaker was cut to “market perform” from “outperform” by Mitsubishi UFJ Morgan Stanley Securities Co.

First Ship Lease Trust, the Singapore-based ship-leasing company, plunged 10 percent to 39.5 Singapore cents after its BB- credit rating was placed on watch for a possible downgrade by Standard & Poor’s Ratings Services.

Gold Shares Advance

In Sydney, Newcrest Mining Ltd., Australia’s largest gold producer, climbed 0.9 percent to A$33.50 after gold rose to a record yesterday. Rival St. Barbara Ltd. jumped 5.9 percent to 36 Australian cents. Avoca Resources Ltd., an Australian gold exploration company, increased 7.4 percent to A$2.33. Real Gold Mining Ltd. climbed 2.7 percent to HK$12.82 in Hong Kong.

The price of gold climbed to $1,254.50 an ounce in New York yesterday, surpassing the previous high of $1,249.70 set on May 14, as demand for the metal rose among investors seeking a haven from the financial turmoil in Europe. Gold for immediate delivery fell 0.1 percent today to $1,235.30 an ounce.

Elpida Memory Inc., Japan’s sole maker of computer-memory chips, sank 2.9 percent to 1,691 yen in Tokyo. Hynix Semiconductor Inc., the world’s second-largest maker of computer memory chips, fell 3.6 percent to 25,500 won in Seoul. Samsung Electronics Co. declined 2 percent to 769,000 won. An index of prices for dynamic-random-access-memory chips fell yesterday for the first time since June 1.