Asian stocks fell on news of the International Monetary Fund's cuts to growth forecasts for the world's major economies. The regional benchmark index therefore suffered a setback on the eve of an eagerly awaited meeting of the Fund in Tokyo this week.
Honda Motor, Japan's second largest automaker by market value, fell 1,4% in Tokyo. Altech fell 6,3% after the Japanese industrial machinery distributor lowered its annual net profit estimates. Oil Search, Papua New Guinea's largest oil producer, climbed 3,1% in Sydney after signing an exploration license deal with Total SA affiliates.
The MSCI Asia Pacific index was down 0,1% at 122.03 as of 9:29am in Tokyo. The regional index gained 4% last month on expectations that China would introduce new measures to stimulate growth in the world's second-largest economy, following moves by US and Japanese central banks. The Nikkei 225 Stock Average fell 0,6% on a reopening day after closing for a long weekend. Singapore's Straits Times and Taiwan's Taiex Index both lost 0,1 percent. The South Korean Kospi Index (+0,2%) and the Australian S&P/ASX 200 (+0,4) went against the trend, the latter rising thanks to the increase in business confidence data in September.
"Asia is a major global exporter and is suffering not only from the Chinese slowdown, but also from the problems affecting Europe," said Matthew Sherwood, head of market investment research at Perpetual. “We look carefully at the elements of risk in companies' balance sheets, because we live in a period of capital contraction”.
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