Asian Stocks Decline

Asian stocks fell, extending declines, after the U.S. Senate passed a $700 billion rescue package to revive credit markets.

Mitsubishi UFJ Financial Group Inc., Japan's biggest bank, dropped 1.4 percent, erasing an earlier gain of 2.5 percent. Toyota Motor Corp. and Honda Motor Co., Japan's two largest carmakers, slumped after vehicle sales in the U.S. tumbled. Futures on the Standard & Poor's 500 Index declined 1 percent.

The MSCI Asia Pacific Index dropped 1.1 percent to 107.77 as of 10:58 a.m. in Tokyo, extending a loss of 0.6 percent immediately prior to the Senate vote. Japan's Nikkei 225 Stock Average declined 0.9 percent to 11,271.34.

The financial-rescue plan funds the biggest U.S. government intervention in the markets since the Great Depression. The package now goes to the House of Representatives, which rejected an earlier version of the measure.

Yesterday, U.S. stocks fell as a report showed manufacturing contracted more than forecast and analysts cut earnings estimates on industrial companies, overshadowing Warren Buffett's $3 billion investment in General Electric Co.

The S&P 500 retreated 5.05, or 0.43 percent, to 1,161.04 at 3:59 p.m. in New York, extending its biggest monthly drop in six years. The Dow Jones Industrial Average slipped 16.33, or 0.2 percent, to 10,831.55. The Nasdaq Composite Index fell 22.48, or 1.1 percent, to 2,069.4. Two stocks declined for each that rose on the New York Stock Exchange.

Canadian stocks extended their decline, after the biggest monthly drop in a decade, as energy producers and industrial companies fell on concern that the $700 billion U.S. rescue plan for banks won't stave off a recession.  The Standard & Poor's/TSX Composite Index fell 0.6 percent to 11,687.15 at 3:16 p.m. in Toronto as 135 stocks declined and 106 advanced.

The Bovespa index rose 192 or 0.4 percent, to 49,734.1 at 3:58 p.m. New York time. Of 66 stocks in the Bovspa Index, 42 stocks rise and 24 lost value., Bloomberg
10/1/2008 7:23:55 PM