Asian exporters hit by global demand fears

Australian shares slumped to their worst performance in 14 months as growth fears provoked a second day of heavy selling across Asia with exporters and resource stocks leading the falls.

The S&P/ASX 200 index in Sydney sank 2.3 per cent to 4,332.83, its lowest closing level for nearly a year.

The FTSE Asia Pacific index followed Tuesday’s 1.7 per cent drop to tumble a further 2.1 per cent to 258.45, the worst day for the region’s stocks for nearly five months as US consumer spending fuelled concerns about slowing growth in the world’s largest economy

“The weak US economic data hurt sentiment across the region,” said Oh Seung-hoon, an analyst at Daishin Securities in Seoul. “Investors are focusing on the global economic outlook now that the US has reached a deal to raise its debt ceiling.”

Resource stocks sank on worries that slowing global growth would damp demand for raw materials.

BHP Billiton , the world’s largest miner by sales, fell 3.4 per cent to A$40.15 while BlueScope Steel , Australia’s biggest steelmaker by sales, sank 5.4 per cent to A$1.05.

Tokyo’s Nikkei 225 Average slid 2.1 per cent to 9,637.14 while Seoul’s Kospi index fell 2.6 per cent to 2,066.26, both indices plumbing five-week lows.

Among exporters hit, Samsung Electronics , the world’s largest technology company by sales, retreated 2.2 per cent to Won833,000.
Toyota Motor , the world’s largest carmaker by sales, shed 1.3 per cent to Y3,120 after reporting its first quarterly loss in two years in the wake of the March earthquake.

Renesas Electronics Corp , a leading producer of automotive chips, tumbled 5.5 per cent to Y620 after its annual outlook missed market expectations.

China’s Shanghai Composite index edged 0.1 per cent lower to 2,678.49 as the US spending figures raised fears about demand for travel, weighing on airlines.

China Southern Airlines , the biggest carrier by fleet size, and China Eastern Airlines , the second-largest, both fell 2.7 per cent, to Rmb7.82 and Rmb5.12, respectively.

In Hong Kong, the Hang Seng index retreated 1.9 per cent to 21,992.72 as companies with the largest exposure to the US market also suffered. Li & Fung , a leading supplier to Walmart, sank 5 per cent to HK$12.30.