Asia: Stock futures outside Japan fall as commodity losses mount

[WELLINGTON] Most Asian index futures retreated amid a selloff in commodities, as the US dollar maintained its advance. Forwards on the Philippine peso slipped after anti-establishment candidate Rodrigo Duterte claimed victory in the country's presidential election.

Contracts on stock gauges from Australia to Hong Kong dropped, and futures on US indexes declined at the start of Tuesday trade. Japanese index futures were mixed, however, following a 1.1 per cent slide in the yen. The US dollar was near its strongest point this month against the euro, stoking further losses in crude oil and copper futures, after the Bloomberg Commodity Index sank last session by the most since March.

One-month non-deliverable forwards on the Philippine peso fell 0.4 per cent after a US exchange-traded fund tracking the Southeast Asian nation's stocks dropped the most in three months.

"Two developing macro themes are set to dominate markets in the near term: the continued gain in the dollar and the pullback in the oil price," Angus Nicholson, a markets analyst in Melbourne at IG Ltd, said in an e-mail to clients.

"Commodities are set for a tough time in a stronger dollar environment, but news that China may be pulling back on its aggressive first-quarter stimulus is also driving prices lower."

Stocks around the world have lost momentum over the past two weeks amid simmering pessimism over the pace of global growth and lackluster corporate earnings. Chinese trade data released over the weekend showed exports fell in April, while imports dropped for the 18th month in a row.

At the same time, weaker-than-expected American jobs figures from Friday fueled bets over continued central-bank support as traders speculated the Fed will employ a slower pace of policy tightening. Changing winds eased the threat of wildfires in Canada, after supporting oil gains on prospects of a drop in world supply.

Stocks

New Zealand's S&P/NZX 50 Index fell 0.1 per cent as of 8:57 am Tokyo time, extending Monday's losses for the first major stock gauge to start trading each day. Futures on the S&P 500 slipped 0.2 per cent following a day of fluctuations in US equities that left the American benchmark up just 0.1 per cent.

In Sydney, futures on the S&P/ASX 200 Index were down 0.5 per cent following the slump in industrial metals and after iron- ore prices plummeted 5.7 per cent at China's Qingdao port, to the lowest level in a month.

Iron ore is sliding after a dramatic surge of speculation in China had helped hoist benchmark prices to the highest level in 15 months. The mania prompted regulatory authorities and exchanges to team up to quell the excesses, while banks including Brazil's Itau Unibanco Holding SA warned the price gains weren't justified in an oversupplied market.

Futures on the Kospi index in Seoul retreated 0.2 per cent in most recent trading, while those on the FTSE China A50 Index were down 0.3 per cent.

In Hong Kong, contracts on the Hang Seng Index slipped 0.6 per cent and futures on the Hang Seng China Enterprises Index declined 0.8 per cent.

Nikkei 225 futures were bid for 16,210 in the Osaka pre-market, from 16,220 at their close in Japan on Monday, and yen-denominated contracts on the Japanese index dropped 0.3 per cent in Chicago following a 1.2 per cent jump in the previous session. Singapore-traded Nikkei 225 futures were little changed at 16,220.

China reports on prices Tuesday, with economists projecting ongoing declines in producer prices and steady consumer inflation. Indonesia updates on foreign reserves.

BLOOMBERG