Asian Stocks decline as China is expected to raise rates (Bloomberg) (22-10-2009)

Oct. 22 (Bloomberg) -- Asian stocks fell, dragging the MSCI Asia Pacific Index down the most in three weeks, on speculation China will raise interest rates and withdraw stimulus after the economy grew at the fastest pace in a year. The dollar advanced.

China Unicom Ltd., the nation’s No. 2 mobile-phone operator, slumped 3.5 percent to HK$10.60. In Hong Kong as the Chinese statistics bureau said inflationary expectations are rising. Sumitomo Mitsui Financial Group Inc. lost 2.7 percent in Tokyo after the downgrade of Wells Fargo & Co. on concern loan losses may be accelerating. LG Electronics Inc. fell 5 percent in Seoul after Credit Suisse Group AG cut its share-price target.

The MSCI Asia Pacific Index lost 1.1 percent to 119.25 as of 6:09 p.m. in Tokyo, the biggest decline since Oct. 2. The gauge has climbed 69 percent from a five-year low on March 9 on signs the global economy is recovering from the worst slowdown since World War II.

China’s Shanghai Composite Index lost 0.6 percent, while Hong Kong’s Hang Seng Index sank 0.5 percent. Esprit Holdings Ltd., the biggest Hong Kong-traded clothier, slid 2.6 percent, after first-quarter sales fell. Datang International Power Generation Co., China’s second-biggest electricity producer, dropped 2.6 percent after posting worst-than-expected profit.

Source: Bloomberg