By Jonathan Burgos and Yoshiaki Nohara
Dec. 22 (Bloomberg) -- Asian stocks dropped, snapping a two-day rally, as lenders sought more cash from the European Central Bank than economists had expected, reducing optimism that the region?s debt crisis will be contained.
Mizuho Financial Group Inc., Japan?s third-biggest lender, fell 1 percent on speculation Europe?s worsening debt problems will hurt bank earnings. Tokio Marine Holdings Inc. slipped 2 percent on concern Japan?s No. 2 casualty insurer may be paying too much to buy Delphi Financial Group Inc. OneSteel Ltd., Australia?s second-largest producer of the metal, gained 5.9 percent after saying it?s not considering a debt or share sale.
?The ECB doesn?t seem to have stepped up to the plate for bond buying, which I think is negative, but at least they are acting as a lender of last resort for banks,? said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has almost $100 billion under management. ?As we are heading closer to a holiday period, volumes decline.?
The MSCI Asia Pacific Index lost 0.4 percent to 112.80 as of 9:38 a.m. in Tokyo, with almost two shares falling for each that rose. The gauge dropped to a three-week low on Dec. 19 after North Korean leader Kim Jong Il died and Fitch Ratings said it may cut the credit ratings of European nations.
--Editor: John McCluskey
To contact the reporters on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net; Jonathan Burgos in Singapore at jburgos4@bloomberg.net.
To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net
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