Japanese stocks fell as concern China’s interest rate increase will slow growth dragged down commodity prices and after the yen advanced, damping the outlook for export earnings. Trading was the lightest in two years.
Inpex Corp., Japan’s No. 1 oil explorer, retreated 1.7 percent. Mitsubishi Corp., Japan’s largest commodities trader, sank 0.6 percent. Tokyo Electron Ltd., a maker of semiconductor equipment that derives more than 60 percent of its revenue abroad, retreated 1 percent. Mizuho Financial Group Inc., Japan’s third-largest bank by market value, climbed 1.3 percent after its chief executive officer said the lender will exceed capital requirements.
Tokyo Electron retreated 1 percent to 5,170 yen. Honda Motor Co., Japan’s second-largest carmaker, lost 0.7 percent to 3,260 yen. Nissan Motor Co., Japan’s third-biggest automaker by sales, dropped 1.3 percent to 781 yen. Kyocera Corp., an electronics maker that gets more than half of its revenue outside Japan, fell 0.7 percent to 8,360 yen.
The yen appreciated to 82.42 against the dollar from 82.75 when the market opened, the strongest level in intraday trading since Dec. 7. A stronger yen reduces income at Japanese companies when overseas revenue is converted into their home currency.
European stocks rebounded from the biggest decline in a month, while trading volumes stayed close to the lowest levels of the year.
Alcatel-Lucent SA advanced 1.9 percent after it resolved U.S. criminal and civil probes into allegations of bribes. Randstad Holding NV rose as Dutch temporary staffing revenue increased. Roth & Rau sank 11 percent after saying it will be unable to meet its sales and earnings forecasts for 2010.
Stocks pared some gains after a report showed confidence among U.S. consumers unexpectedly fell in December. The Conference Board’s confidence index fell to 52.5 this month, lower than the most pessimistic forecast of economists surveyed by Bloomberg News. Separate figures showed American home prices dropped more than predicted in October.
U.S. stocks drifted between gains and losses as data on retail sales, consumer confidence and home prices presented a mixed picture of the outlook for the world’s largest economy.
General Motors Co. rose 2.8 percent after at least seven firms including JPMorgan Chase & Co. and Morgan Stanley initiated coverage of the automaker with a positive view. American Express Co., Caterpillar Inc. and Walt Disney Co. lost at least 0.6 percent to lead declines in the Dow Jones Industrial Average. Homebuilders retreated as home prices dropped more than forecast in October.
The Conference Board’s consumer confidence index decreased to 52.5, lower than the most pessimistic forecast of economists surveyed by Bloomberg News and down from a revised 54.3 in November. U.S. retail sales, excluding autos, rose 5.5 percent to $584 billion from Nov. 5 through Dec. 24 for the biggest holiday-season increase since 2005, according to MasterCard Advisors’ SpendingPulse, which measures retail sales by all payment forms.
Homebuilders fell after the S&P/Case-Shiller index of property values decreased 0.8 percent from October 2009, the biggest year-over-year decline since December 2009. The drop exceeded the 0.2 percent drop projected by the median forecast of economists
PulteGroup Inc. slipped 2.3 percent to $7.32, Lennar Corp. declined 1.2 percent to $18.36 and D.R. Horton Inc. tumbled 2.6 percent to $11.84 as an index of 12 homebuilders in S&P indexes lost 1.5 percent.
General Motors rose 2.8 percent to $35.57. The automaker was rated “overweight” in new coverage at JPMorgan, Barclays Plc and Morgan Stanley. GM was rated “outperform” at Credit Suisse Group AG and RBC Capital Markets, which also initiated coverage of the stock. Citigroup Inc. and Bank of America Corp. have a new “buy” recommendation for GM.
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