Jan. 27 (Bloomberg) -- Shares of commodity producers fell for a ninth day and metals declined as China stepped up measures to curb economic growth. The Australian dollar strengthened after the government reported faster-than-expected inflation.
The MSCI Asia Pacific Index measure tracking metal and mining companies fell 0.9 percent to 281.67 as of 12 p.m. in Tokyo, poised for its longest stretch of losses since July 2000. Copper slid for a second day and zinc lost 0.6 percent. Futures on the Standard & Poor’s 500 Index rose 0.3 percent after the U.S. stock benchmark fell yesterday on concern the Federal Reserve may signal plans to unwind stimulus measures.
Chinese banks have begun restricting new loans, responding to a push by regulators to contain credit and curb the expansion of the world’s fastest-growing major economy. Concerns over slower growth increased after the International Monetary Fund said yesterday the global financial system remains “fragile,” with sovereign debt posing a risk to markets.
“Sentiment is reasonably weak at the moment due to concerns over the tightening in China,” said Mark Konyn, chief executive officer of Hong Kong-based RCM Asia Pacific Ltd., which oversees $12 billion. “We could see a long period of correction.”
BHP Billiton Ltd., the world’s biggest mining company, sank 2.2 percent to A$40.35 and rival Rio Tinto Group slumped 4.5 percent to A$70.04. Mining and energy stocks are the worst performers on the MSCI Asia Pacific Index this year amid concern Chinese efforts to rein in growth will hurt demand for commodities.
Copper, Zinc
Copper, zinc and nickel fell on the London Metal Exchange. Copper for three-month delivery dropped 0.2 percent to $7,369 a metric ton, zinc lost $13.50 to $2,305 and nickel shed 0.8 percent to $18,050. Platinum for immediate delivery slid 0.4 percent to $1,530.25 an ounce while gold traded up 0.3 percent at $1,100.92 an ounce.
The Australian dollar rose against all 16 of its most- traded counterparts after consumer prices gained more than forecast in the fourth quarter, increasing pressure on the central bank to raise interest rates. The yen traded near a nine-month high against the euro on concern the global economic recovery will slow, increasing demand for Japan’s currency as a refuge.
Australia’s currency rose 0.6 percent to 90.39 U.S. cents from 89.86 in New York. It yesterday touched 89.38 cents, the lowest since Dec. 31. The yen traded at 126.27 per euro from 126.16 in New York, when it reached 125.68, the strongest level since April 28. The dollar fetched 89.61 yen from 89.65 yen.
Australian consumer prices rose 0.5 percent in the fourth quarter, compared to the median estimate for a 0.4 percent gain in a Bloomberg News survey.
‘Robust Recovery’
“The Australian economy is on a very robust recovery path so we don’t really need to have rates as low as they are,” said Justin Smirk, chief economist at St. George Bank Ltd. in Sydney. “The Australia dollar will outperform most other commodity and risk-based currencies over the next 24 hours.”
European Central Bank executive board member Juergen Stark said yesterday in Frankfurt the lender is concerned about ballooning budget deficits in the euro region. Greece still faces a credit downgrade risk even after the nation’s 8 billion- euro ($11.3 billion) debt sale earlier this week, Moody’s Investors Service said yesterday.
South Korea’s won rose from the lowest this year, climbing 0.3 percent to 1,159.65 per dollar, after the central bank said the nation had a current-account surplus of $1.52 billion in December, the 11th in a row. The Malaysian ringgit climbed 0.2 percent to 3.4165 after Bank Negara Malaysia said that borrowing costs cannot be kept “too low” for too long.
A slowdown in Chinese lending may help reduce risk and investors should still buy shares of the nation’s banks, investor Mark Mobius said.
“I don’t see a slowdown in lending as a bad thing,” Mobius, who oversees $34 billion in emerging markets funds as chairman of Templeton Asset Management Ltd., said in an interview in Sydney today. “It moderates risk to some degree because people don’t go overboard.”