Asian stocks dropped and the euro fell to a two-year low as Spanish borrowing costs rose and China damped speculation of large-scale economic stimulus. Oil and metals prices slid.

The MSCI Asia Pacific Index lost 1.2 percent as of 10:55 a.m. in Tokyo, led by shares of resources and energy companies. Futures on the Standard & Poor’s 500 Index declined 0.5 percent. The euro weakened 0.3 percent to $1.2465 and the Australian dollar retreated 0.6 percent. Crude fell 0.4 percent to $90.41 a barrel in New York and copper dropped for a second day in London.

China has no plan to introduce stimulus measures of the scale seen during the global financial crisis, the official Xinhua News Agency said yesterday. The world’s second-biggest economy is forecast to expand 8.2 percent this year, the slowest since 1999, according to a Bloomberg survey. Spain’s 10-year bond yield rose to the highest level since November yesterday as the central bank said the nation is sinking deeper into recession, fueling concern Europe’s debt crisis will worsen.

“Chinese authorities do see downside risks to growth this year,” said Dwyfor Evans, a Hong-Kong based strategist at State Street Global Markets, part of State Street Corp., which has $1.9 trillion under management. “They will continue addressing the slowdown but it’s hard to assess if it will be enough.”

The MSCI Asia Pacific Index is headed for a 10 percent decline this month, which would be the biggest loss since October 2008, amid signs of a deepening slowdown in China and as European leaders pressure Greece to meet bailout terms and stay in the euro. Greece will hold an election next month that may settle the matter.

For more visit: Bloomberg.com

Similar Posts:

• Asia Stocks Drop, Euro Weakens Before Meeting
• Asia Stocks Fall for Second Day on China Slowdown, Greece
• Asian Stocks Rise to One-Week High on Recovery; Bond Risk Falls
• World Stocks, Commodities Drop on Fed Outlook
• Stocks, Euro Rise Amid Greece Optimism