Asian stocks fell for third consecutive week

Asian stocks fell for third consecutive week after North Korea fired artillery shells in South Korea, swelling of the concern that tensions will increase.

Korean Air Lines Co., the largest line of the nation by market value, fell 5.4 percent in Seoul. Hyundai Motor Co., the largest automaker in South Korea's market capitalization, fell 6.9 percent. Sun Hung Kai Properties Ltd., the world's largest developer by market value, fell 6.1 percent in Hong Kong after the government announced new measures to prevent a bubble in real estate prices. Honda Motor Co., automaker of Japan's second largest by sales, slumped 1.9 percent.

The MSCI Asia Pacific Index fell 2.1 percent to 128.92 this week. The gauge slid on 23 November after reports of government and media that North Korea fired dozens of artillery shells in the territory of South Korea, his attack for the first time in half a century.

"The markets are taking on the likelihood of any further action by the North Koreans," said Tim Schroeders, who helps manage about $ 1 billion in Pengana Capital Ltd. in Melbourne. "What was initially rejected as a skirmish once is now making people a little nervous."

Kospi index in South Korea fell 2 percent this week, its biggest weekly decline since August. Hong Kong Hang Seng index sank 3.1 percent, the biggest decline among the major indexes of the Asia-Pacific.

The Shanghai Composite Index fell 0.6 percent in China, where the central bank raised the reserve ratio for the second time in two weeks to cool inflation. Australia S & P / ASX 200 fell 0.7 percent.

In Japan, where markets were closed Nov. 23 for a holiday, the Nikkei 225 Stock Average rose 0.2 percent, while the broader Topix index lost 0.3 percent.

Korean tensions

Tensions with North Korea have increased since the sinking of the warship Cheonan South Korea in March, which killed 46 sailors. On November 23 bombing of Yeonpyeong island, which killed four people and wounded 20, was the first of its kind since the Korean War from 1950 to 1953 and encouraged the president Barack Obama to send a U.S. aircraft carrier in the Yellow Sea to show support and strength.

North Korea warned that any "confrontation escalated" will lead to war, state news agency KCNA, said yesterday.

"A more bubbles of the tensions in Korea is another layer of uncertainty for markets that do not need to address," said Schroeder's Pengana. "It is not enough happening in terms of problems of European debt and inflation in China without having to deal with geopolitical tensions erupt.'s Probably just another trigger point for people to sell."

Hong Kong Property

The MSCI Asia Pacific index has changed little this month. It has risen 7.4 percent this year on speculation earnings growth will be higher than China's measures to tackle the fastest inflation in two years and the fiscal deficit crisis in Europe. Shares in the indicator value at 14 times estimated earnings on average, compared with 23 times at the beginning of the year.

A group of actions related to finance, including real estate companies, fell more than this week among the 10 industry groups in the MSCI Asia-Pacific, and Hong Kong developers led declines among groups Hang Seng Index Four industry.

Financial Secretary, John Tsang, on November 19 raised the stamp duty and deposits increased, however, tougher measures to curb the rise in home values, which have soared 50 percent since January 2009 . Hong Kong Monetary Authority Chief Executive Norman Chan, said the initial payment for some households will increase, the second hike this year requirements.

"The government measures to cool property prices are showing some effect, and developers are headed by a long decline," said Francis Lun, general manager of Fulbright Securities Ltd. in Hong Kong.