Asian stocks drop on rising costs

GLOBAL MARKETS/ STOCK REPORT

Cathay Pacific Airways, Hong Kong's largest airline, tumbled to the lowest in almost two years after saying earnings will be "disappointing.'' Nippon Yusen KK, Japan's biggest shipping line, fell on concern this year's 48 per cent jump in oil will reduce trade. Toyota Motor retreated in Tokyo after its US sales slumped 21 per cent last month.

The MSCI Asia Pacific Index lost 1.3 per cent to 134.12 at 7:29 pm in Tokyo, dropping for the ninth time in 10 days. Almost three stocks fell for each that gained, and eight of the index's 10 industry groups declined.

Japan's Nikkei 225 sank 1.3 per cent to 13,286.37, capping a 10-day, 8.1 per cent slump. The retreat is the longest since 1965, when the Vietnam War was escalating, Japan was in a recession and the central bank had to bail out two brokerages.

Europe

European stocks rose after UBS AG and Deutsche Bank AG reduced concerns about credit losses by saying they don't need more capital, and AstraZeneca's victory in a patent case lifted drugmakers. US index futures gained.

Europe's Dow Jones Stoxx 600 Index advanced 1.1 per cent to 285.96 at 11:16 am in London, as 14 of the 18 industry groups gained. National benchmark indexes rose today in all 18 western European markets that were open except Ireland. The UK's FTSE 100 gained 1.4 per cent, while Germany's DAX increased 1.2 per cent. France's CAC 40 added 0.8 per cent.

US

US stocks rose, helping the market rebound from its worst month in six years, after better-than- forecast sales at General Motors overshadowed concern that rising energy costs will damp corporate profits.

The Dow Jones Industrial Average climbed 32.25 points, or 0.3 per cent, to 11,382.26, erasing earlier declines that sent the 30-stock gauge into a bear market for a third day. The Standard & Poor's 500 Index added 4.91, or 0.4 per cent, to 1,284.91.