Asian stocks drag

GLOBAL MARKETS/ STOCK REPORT

Asian stocks on Tuesday fell, dragging a key regional indeces from record highs, after Kookmin Bank reported earnings that missed analyst estimates and Baoshan Iron & Steel's profit decreased for the first time in more than a year.

Takeda Pharmaceutical, Asia's biggest drugmaker, plunged the most in 20 years because of delays in developing a new drug. Kookmin, South Korea's largest lender, had its biggest drop in more than two months.

Toshiba, which reported earnings on Monday after markets closed, fell as UBS AG and CLSA Asia- Pacific Markets cut their ratings on the stock.

The Morgan Stanley Capital International Asia-Pacific Index slid 0.4 per cent to 171 as of 6:53 pm in Tokyo, with six of 10 industry groups declining.

Japan's Topix gained, while the Nikkei 225 Stock Average fell with most of Asia's other benchmarks. China, Hong Kong and Malaysia were the only gainers among the regions 10 biggest markets.

Asia is home to four of the world's five best-performing stock benchmarks in the past two months and concern is building that gains more than reflect earnings prospects.

Hong Kong's Hang Seng Index, which closed at a second straight record, is valued at 21 times reported earnings, the highest in at least five years, according to data compiled by Bloomberg.

EUROPE
European stocks fell for the first time in four days after UBS AG, the region's biggest bank, posted its first quarterly loss in almost five years on writedowns tied to the US mortgage market.

Dassault Systemes SA sank after the French software maker cut its full-year earnings and sales forecasts. BHP Billiton Ltd. and Rio Tinto Group retreated as metals prices slipped.

"It is going to be tougher for quite a while,'' said Jane Coffey, who helps oversee about $14 billion as head of equities at Royal London Asset Management. "We are not really out of the credit crunch time yet.''

US
US stock-index futures retreated before a report that may show consumer confidence dropped to a two-year low, threatening to crimp demand in the world's largest economy.

Procter & Gamble, the largest US consumer-goods maker, fell before posting earnings. Wal-Mart Stores, the world's biggest retailer, and Amazon.com, the No. 1 Internet retailer, paced a decline in US retail stocks traded in Europe.

Standard & Poor's Index futures expiring in December lost 2.5 to 1,544.50 as of 9:27 am in London.

Dow Jones Industrial Average futures dropped 21 to 13,886. Nasdaq-100 Index futures slid 4 to 2,211.50.

"The sub-prime crisis will certainly leave its mark, although it might take the next quarter to show,'' said Stefan Raetzer, who helps manage about $28.2 billion in stock funds for retail investors at Allianz Global Investors in Frankfurt. ``A lot of positive news has been priced in.''

A private report may show consumer confidence decreased in October as home prices fell and fuel bills rose. US Treasury Secretary Henry Paulson said it's too soon to call an end to a US housing slump. The Federal Reserve meets to set policy on interest rates. Its decision is expected tomorrow.