Japanese stock futures fell in U.S. trading as Shinsei Bank Ltd.'s wider-than-estimated loss and concern the economic slump is worsening fueled a drop in financial shares.
Mitsubishi UFJ Financial Group Inc., Japan's largest lender, sank to a five-year low, driving the Bank of New York Mellon Asia ADR Price Index down 4.5 percent. The benchmark, which tracks American depositary receipts of the region's companies, slid 4.09 points to 86.14.
Solar shares tumbled after JA Solar Holdings Co., a Chinese solar-cell maker, reduced its 2009 sales forecast. Cnooc Ltd. led a drop in energy producers as oil fell to a 21-month low.
“You're in a panic stage of a market where everyone is coughing up everything,'' said Robert Olstein, chairman of Olstein Capital Management, in an interview with Bloomberg Television.
Nikkei 225 Stock Average futures expiring in December were at 8,135 in Chicago at 6:48 a.m. Tokyo time, down from the closing levels of 8,740 in Osaka, Japan, and Singapore. The index yesterday lost 1.3 percent to 8,695.51.
U.S. stocks fell for a third day as Best Buy Co.'s warning of a “seismic'' slowdown in spending and the Treasury's plan to use bailout funds to bolster consumer credit stoked concern the economic slump is deepening. The Standard & Poor's 500 Index dropped 5.2 percent.
Japanese banks are struggling to boost earnings as the biggest financial crisis since the Great Depression weakens the economy, fueling investment losses, bad debts and corporate bankruptcies.
Shinsei Bank, the first Japanese lender acquired by overseas investors, said it had a first-half deficit of 19.3 billion yen ($202.9 million) on losses related to Lehman Brothers Holdings Inc.'s bankruptcy and investments in Europe. The company had forecast a 15 billion yen loss. The stock was not traded in the U.S.
Mitsubishi UFJ slipped 4 percent to $5.97 on the New York Stock Exchange. Sumitomo Mitsui Financial Group Inc., Japan's third-biggest bank by revenue, dropped 5 percent to $3.83.
Mizuho Financial Group Inc. lost 0.9 percent to $5.30. Japan's second-largest lender may issue 300 billion yen in preferred securities to insurance companies to increase its capital, Nikkei English News reported, without saying where it got the information.
Solar shares accounted for seven of the 10 biggest losers in the Asian ADR index after JA Solar trimmed its sales forecast by a quarter, citing credit tightness and the economic slowdown. The stock plunged 29 percent to $2.38.
Renesola Ltd. fell the most in the Asian ADR index, tumbling 42 percent to $3.47. Yingli Green Energy Holding Co. slipped 22 percent to $4.18. LDK Solar Co. sank 22 percent to $13.12. China Sunergy Co. dropped 21 percent to $2.97.
Speculation that International Energy Agency will cut its global demand estimate and the U.S. will report that stockpiles gained sent oil prices down for a second day.
Cnooc Ltd., China's largest offshore oil producer, declined 4.4 percent to $72.26. Santos Ltd., an Australian oil and natural gas company, slipped 4.8 percent to $33.76.
Mitsubishi Corp., a Japanese trading house that gets half its profit from commodities, lost 8.5 percent to $27.49.
Slowing demand has forced more companies to cut output. Formosa Petrochemical Corp., Taiwan's only publicly traded oil refiner, said yesterday that it will keep its No. 3 ethylene plant shut this month because of weak demand. Nanya Technology Corp., the second-biggest computer-memory chipmaker on the island, plans to cut production by 20 percent in the first quarter.
Both companies' shares were not traded in the U.S.