* MSCI Asia ex-Japan tumbles, Nikkei eases in choppy trade
* Korea leads drop despite record Q3 profit from Samsung
* Yen pauses from selling as risk aversion helps
* Oil, copper, gold turn negative
* European shares likely to slump
By Chikako Mogi
TOKYO, Oct 26 Asian shares and commodities slid
on Friday while the yen steadied as investors shunned risk on
concerns over corporate earnings, with the region's exporters
struggling against shrinking global demand.
Oil retreated after rising on Thursday while London copper
turned negative after earlier rising on short-covering,
and gold, usually associated as a safe-haven, tracked a broad
market decline led by a slump in Asian equities.
European shares were seen slipping as U.S. stock futures
fell 0.8 percent to suggest a weak Wall Street open.
Financial spreadbetters expect London's FTSE 100,
Paris's CAC-40 and Frankfurt's DAX to open down
as much as 1.2 percent.
The MSCI index of Asia-Pacific shares outside Japan
tumbled 1.2 percent, and was set for a weekly
drop of about 1.5 percent, which would be its largest weekly
decline in two months.
China shares slumped 2 percent, underperforming Asian peers
and dragging Hong Kong markets into the red after Chinese media
reported domestic fund managers were not optimistic on the
fourth quarter with funds reporting total losses of around 75
billion yuan ($12.02 billion) in the third quarter.
Hong Kong shares fell 1.2 percent and Shanghai shares
slumped 1.8 percent.
Samsung Electronics reported record quarterly
profits for a fourth straight quarter on Friday. And Bank of
China Ltd posted its biggest quarterly profit gain in
a year the day before, but they failed to remove concerns about
the outlook. Other top Chinese banks report later on Friday.
South Korean shares slid 1.4 percent to their lowest
since early September. Australian shares fell 0.8
percent, losing 2.1 percent for the week in its biggest drop
"Traders are starting to get desperate for a feel good
economic indicator from somewhere," said Tim Waterer, senior
trader at CMC Markets. "If one does not arrive soon the soft
patch in markets witnessed this week could develop into a more
Some markets in the region were closed on Friday, including
the Philippines and Singapore, to mark a religious holiday.
Markets' next key focus is the advanced reading of U.S.
third-quarter gross domestic product due later on Friday, with
the annualised rate of growth in the world's largest economy
seen at 1.9 percent, up from 1.3 percent in April-June.
Profit for Samsung Electronics, the world's largest
electronics company, will likely decline into next year as TV
markets stagnate and growth in the high-end smartphone market
eases from the recent breakneck speed.
"Though Samsung's sales, particularly of its smartphones,
are impressive, what shareholders would like to see is margins
that are closer to those of Apple," said Lee Yong-jik, a fund
manager at Pine Bridge Investments, who owns shares of the
Apple Inc, the most valuable public company in the
United States, on Thursday posted quarterly earnings that fell
short of expectations.
Bank of China posted solid results after cutting back on
bad-loan provisions, prompting concerns that it may face a cash
crunch if more borrowers default as the economy worsens.
EXPORT POWERS HIT
The deterioration in the euro zone economy, hit hard by the
region's prolonged debt crisis, and shrinking global demand has
hit Asian exporters.
South Korea's economy grew by 0.2 percent in the
July-September period from the previous three-month period, the
slowest quarterly growth since the fourth quarter of 2009 in
Asia's fourth-largest economy. The median forecast called for a
0.1 percent expansion.
Japan, Asia's other export-reliant powerhouse hit by weak
global demand, approved a 422.6 billion yen ($5.3 billion)
economic stimulus package of subsidies and tax grants on Friday.
Japan's Nikkei average fell 1 percent as Asian
"The market is confused about how to react to the earnings
cuts and to what extent they're priced in," said Yuuki Sakurai,
CEO of Fukoku Capital Management.
The dollar eased 0.3 percent against the yen to 80.07
after hitting a fresh four-month high of 80.38 yen early in Asia
on Friday on expectations the Bank of Japan will take aggressive
easing measures at its policy meeting on Oct. 30.
The euro also fell 0.3 percent to 103.60 yen and
the Australian dollar fell 0.7 percent to 82.63 yen.
Japan's core consumer prices fell for the fifth straight
month in the year to September, keeping pressure on the BOJ to
do more to achieve its inflation target.
The euro edged 0.1 percent higher to $1.2942, not far from a
near two-week low around $1.2921 seen on Wednesday.
U.S. crude futures slid 1 percent to $85.17 a barrel
and Brent dropped 0.9 percent to $107.46.
Asian credit markets were subdued, keeping the spread on the
iTraxx Asia ex-Japan investment-grade index little
changed from Thursday.