Asian stocks fell for a third day, with the regional benchmark index set for the longest losing streak in six weeks, as U.S. lawmakers remained at odds over lifting the debt ceiling to avoid a default.
Cokal Ltd., a coal mine developer, slumped 20 percent in Sydney after saying takeover talks with Blumont Group Ltd. were affected by a record plunge in the buyer's stock. Blumont soared 69 percent today in Singapore after plunging 85 percent yesterday. Rakuten Inc., a Japanese online shopping site, fell 13 percent after Yahoo Japan Corp. said it would eliminate vendor fees for its shopping and auction sites. Tokyo Electric Power Co., the owner of the crippled Fukushima Dai-Ichi nuclear power plant, rebounded 6.4 percent after declining 20 percent over the past five days.
The MSCI Asia Pacific Index dropped 0.1 percent to 137.79 as of 11:04 a.m. in Tokyo. Shares extended last week's losses as the partial U.S. government shutdown stoked concern lawmakers will fail to raise the nation's $16.7 trillion debt limit this month. President Barack Obama yesterday reiterated that he won't negotiate with Republicans over the shutdown and borrowing cap.
"The real issue has now become the debt ceiling and that's what worries investors,"said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has $131 billion under management. "If it's not resolved, it could have catastrophic consequences for the global financial system."
Consumer staple companies dropped the most among the MSCI measure's 10 industry groups while utilities led gains, spurred by Tokyo Electric.
Regional GaugesJapan's Topix index declined 0.2 percent. The nation's current account surplus missed estimates in August, data showed. South Korea's Kospi index dropped 0.5 percent and New Zealand's NZX 50 Index fell 0.2 percent. Australia's S&P/ASX 200 Index decreased 0.5 percent even as data showed business confidence surged in September to the highest level in 3 1/2 years.
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Hong Kong's Hang Seng Index (HSI) gained 0.4 percent. Singapore's Straits Times Index rose 0.1 percent and Taiwan's Taiex index lost 0.2 percent. The Shanghai Composite Index was little changed as markets in mainland China reopened today after a week-long holiday.
HSBC Holdings Plc and Markit Economics' purchasing managers' index for China's service industries was 52.4 in September, compared with 52.8 in August, data showed today.
Futures on the Standard & Poor's 500 Index fell 0.1 percent after the gauge slumped 0.9 percent to a one-month low yesterday. Without an increase to the debt limit, the U.S. will exhaust its borrowing authority on Oct. 17 and would run out of funds to pay all of its bills sometime between Oct. 22 and Oct. 31, according to the Congressional Budget Office.
The MSCI Asia Pacific Index traded at 13.3 times estimated earnings as of yesterday, compared with 15.1 for the S&P 500 and 14.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
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