Asian markets fall as BHP Billiton slumps

World’s largest miner down 3.9% as it announces the biggest spinoff in the mining industry, separating aluminum, coal and silver assets

Asian stocks fell after valuations reached the highest level this year and as BHP Billiton (BHP) slumped, dragging materials shares to the largest decline on the regional gauge.

BHP, the world's largest miner, tumbled 3.9 per cent in Sydney after announcing a spinoff and refraining from a share buyback expected by some investors. Biostime International Holdings tumbled 9.7 per cent in Hong Kong after the maker of infant formula posted first-half results that missed estimates. QBE Insurance Group surged 5.6 per cent in Sydney as it completed a A$650 million ($604 million) capital raising.

The MSCI Asia Pacific Index slipped 0.1 per cent to 148.65 in Hong Kong, with an equal number of shares rising and falling. The gauge closed yesterday within 1 percent of a six-year high as concern eased over global conflicts. Data yesterday showed US inflation pressures remain limited and housing starts jumped as the Federal Reserve watches economic reports to help gauge the timing of interest-rate increases.

“With valuations full, it doesn’t take much to disappoint the market,” said Ric Spooner, chief market analyst at CMC Markets in Sydney. “Short-term traders are reversing their position on BHP today. Economic news from the US last night did nothing to dispel the picture of a favorable macro environment for stocks.”


Japan trade

Japan's Topix index slid 0.1 per cent. Exports rose more than than estimated in July while imports unexpectedly increased. Hitachi Metals Ltd. added 3.2 per cent to 1,790 yen after unveiling plans to pay $1.3 billion to acquire Waupaca Foundry Inc.

Hong Kong’s Hang Seng Index gained 0.1 per cent, heading for the highest close since May 2008. The MSCI Hong Kong Index added 1.2 per cent, poised for a record close. The Hang Seng China Enterprises Index, which tracks mainland Chinese companies listed in the city, dropped 0.3 per cent, while the Shanghai Composite Index lost 0.1 per cent. India’s S&P BSE Sensex Index declined 0.2 per cent.

Singapore’s Straits Times Index and Taiwan’s Taiex index both gained 0.5 per cent. South Korea’s Kospi index added 0.1 per cent and New Zealand’s NZX 50 Index advanced 0.5 per cent. Australia’s S&P/ASX 200 Index rose 0.2 per cent to the highest close since June 2008.

Futures on the Standard & Poor's 500 Index slipped 0.1 per cent today after the gauge yesterday closed within 0.3 per cent of an all-time high. The Nasdaq Composite added 0.4 per cent, its fifth straight day of increases, to close at the highest level since 2000. Apple Inc. closed at a record high.

US inflation

US inflation weakened to the slowest pace in five months in July, holding below the Federal Reserve's target. Minutes of the Fed's July 29-30 meeting, when the stimulatory bond-buying program was reduced by $10 billion for a sixth time, are released today and Fed Chair Janet Yellen will speak to global central bankers later this week.

Yellen, who has said key rates will stay low for a considerable time after the conclusion of asset purchases, will speak on labor markets Aug. 22 at the Fed Bank of Kansas City's economic symposium in Jackson Hole, Wyoming. Policy makers including European Central Bank President Mario Draghi will attend.

The US consumer price index rose 0.1 per cent in July from the previous month and was up 2 percent from a year earlier, matching median economist estimates compiled by Bloomberg.

QBE climbed 5.6 per cent to A$11.31, the most since May 2013. The Australian insurer's share sale and debt refinancing will raise about $1.5 billion, chief executive officer John Neal said on a call with reporters yesterday.