SINGAPORE (Bloomberg) -- Asian stocks dropped for a second day, led by financial and technology companies, as losses at Hitachi Ltd. and Mizuho Financial Group Inc. fueled concern the global recession is deepening.

Hitachi, the world’s third-largest maker of hard-disk drives, plunged 17 percent in Tokyo after forecasting a record loss. Mizuho, Japan’s second-largest listed bank, declined 6.6 percent after posting its second quarterly loss in a row. Wharf (Holdings) Ltd. slumped 7.7 percent in Hong Kong, leading declines among the city’s property companies on a newspaper report that office rents will drop this year.
“The data coming out is getting gloomier and gloomier,” said Chris Hall, who helps oversee about $2 billion at Adelaide, South Australia-based Argo Investments. “Investors are very, very nervous about the reporting season.”
The MSCI Asia-Pacific Index lost 2.1 percent to 81.42 as of 4:09 p.m. in Tokyo. Three stocks declined for each that advanced on the gauge, which has slumped 9.1 percent this year amid mounting signs of deteriorating corporate profits.
Japan’s Nikkei 225 Stock Average dropped 1.5 percent to 7,873.98 at the close. Hong Kong’s Hang Seng Index fell 3.2 percent. China’s Shanghai Composite Index added 1.1 percent following a holiday last week for the Lunar New Year. Other markets fell except Taiwan, the Philippines and Sri Lanka.
Mitsubishi Electric Corp., a Japanese maker of consumer electronics and factory machinery, fell 9.1 percent on a lower profit forecast. Sharp Corp. lost 4.6 percent after a newspaper said the company may report losses. Rio Tinto Group jumped 5.5 percent in Sydney after saying it’s in talks to sell stakes in units to its largest shareholder.
Prolonged slowdown?
Futures on the Standard & Poor’s 500 Index added 0.2 percent. The gauge slid 2.3 percent on Jan. 30, capping a fourth weekly drop, as a government report showed the world’s largest economy shrank at the fastest pace in 26 years.
U.S. President Barack Obama told NBC television that the economy is “in for a tough several months” before a recovery takes hold. Obama said once his economic stimulus package has been passed by Congress, his administration will be unveiling a more extensive plan to deal with financial-market regulation.
Governments around the world are stepping up efforts to revive a global economy burdened by more than $1 trillion of losses tied to the credit crisis. Global growth will almost grind to a halt this year, an International Monetary Fund report said last week. South Korea’s exports tumbled by a record 32.8 percent in January, a government report on Monday showed.
China’s Premier Wen Jiabao said Beijing was considering additional measures to boost its economy beyond the $584 billion fiscal package it introduced late last year, the Financial Times reported, citing an interview with Wen in London.
Shrinking demand
Hitachi slumped 17 percent to 244 yen. The company reversed its profit forecast on Jan. 30 to a record net loss of 700 billion yen ($7.81 billion) for the year ending March 31. Demand in the automobile, semiconductor and industrial-equipment industries was declining “rapidly,” the company said.
Japanese companies from car manufacturers to electronics makers have cut their full-year earnings outlooks as demand for their products softened and as a strengthening yen dented the value of overseas sales. Domestic businesses reporting their third-quarter earnings have posted an 85 percent tumble in net income for the quarter, Tokyo-based Shinko Research Institute Co. said in a report dated Jan. 30.
“With shrinking demand, companies are increasingly likely to incur deeper, longer earnings slumps in fiscal 2009,” said Hisakazu Amano, head of fund management at Tokyo-based T&D Asset Management Co., which oversees about $39 billion. “It’s hard to imagine demand will recover in the foreseeable future.”
Worst performers
Mitsubishi Electric tumbled 9.1 percent to 382 yen after cutting its full-year profit forecast 92 percent. Sharp, Japan’s largest maker of liquid-crystal-display televisions, slid 4.6 percent to 646 yen after the Asahi newspaper said the company may post the first net loss since its stock first traded in 1956.
An index of financial shares on MSCI’s Asian gauge dropped 3.1 percent. The finance measure has slumped 12 percent this year, the most among the MSCI index’s 10 industry groups, as losses from the credit crisis swelled.
Mizuho, the Japanese bank with the biggest sub-prime write-downs in Asia, slumped 6.6 percent to 212 yen. The company turned to a 145.1 billion yen loss in the three months ended Dec. 31 from a 66 billion yen profit a year earlier.
Daiwa Securities Group Inc., Japan’s second-largest brokerage, fell 6.9 percent to 469 yen after posting its largest quarterly loss in more than seven years.
Raising cash
Wharf declined 7.7 percent to HK$18, the sharpest drop on Hong Kong’s Hang Seng Index. Swire Pacific Ltd. retreated 6.6 percent to HK$47.65. Cheung Kong (Holdings) Ltd., the city’s No. 2 property company by market value, fell 5.6 percent to HK$68.80.
Hong Kong office rents “will soften” this year as the global financial crisis weakens demand for space, the South China Morning Post newspaper said Jan. 31, citing a general manager at Swire’s properties unit.