* Stocks down 4th day, focus on regulations, recovery
* Japan's Nikkei sitting on 25-day moving average
* Leading indicators sew caution about second half outlook
By Kevin Plumberg
HONG KONG, June 25 (Reuters) - Asian stocks on Friday slid
for a fourth straight session, driven by expectations of
tighter financial regulation ahead of the weekend G20 meeting
and uncertainty about the global economic recovery.
Part of the weakness was attributable to profit-taking
after a powerful rally in risky assets on Monday on the back of
China's decision to unpeg the yuan.
However, differences among G20 leaders ahead of a summit in
Toronto over how to secure the economic recovery caused
investor concern, particularly with leading indicators
reflecting a slowdown ahead. []
"There is some form of a renewed crisis in confidence,"
said Patrick Yiu, an analyst at CASH Asset Management in Hong
Kong. "We're likely to see a pullback because of this weak
sentiment, but should find support soon."
Japan's Nikkei share average <> led equity market
declines in Asia, falling 1.5 percent. Index heavyweights such
as Fanuc <6954.T> and Canon <7751.T> saw their shares drop 3.9
percent and 4.1 percent, respectively.
A close below the 25-day moving average for the Nikkei
would be a negative short-term signal for Japanese stocks.
The MSCI index of Asia Pacific shares outside Japan
<.MIAPJ0000PUS> slipped 0.5 percent, dragged down by the
technology and resource-related sectors.
For the week, the index was largely unchanged. In a
reversal of sectoral performance for most of the year, the
industrial and materials segments, which includes mining
stocks, outperformed, while IT was the biggest underperformer.
TOUGHER RULES FOR BANKS?
Australian miners such as BHP Billiton <BHP.AX> were down.
The industry got a boost on Thursday after a dramatic slide in
support for the government, largely because of a 40 percent tax
on mining companies, ushered into power a new prime minister
for Australia. [] []
Hong Kong's Hang Seng reversed earlier losses to trade
flat, after HSBC was the biggest drag on the market, down 0.8
percent.
Banks in the United States could face tougher curbs on
trading but would be able to hold limited hedge fund positions
under a proposal unveiled by Senate Democrats on Thursday.
[]
U.S. stocks <.SPX> ended about 1.7 percent lower overnight
and have dropped nearly 4 percent this week, underperforming
European <> and Japanese <> shares by a wide margin.
Retailers and banks were under pressure throughout the session.
With world leaders increasingly speaking about fiscal
austerity, investors have seriously questioned the implications
for growth.
Indeed, U.S. new home sales plunged by a record 33 percent
in May from April and the Baltic Exchange's sea freight index
<.BADI>, which is used as a leading economic indicator, was
down 39 percent so far in June, on track for the biggest
monthly decline since October 2008.
Goldman Sachs economists said in a note that global growth
will slow to a 4 to 4.5 percent pace from a 5 to 5.5 percent
quarter-on-quarter annualised pace in the first half in the
second half.
Currencies were hemmed into tight trading ranges on Friday,
with the euro at $1.2328 <EUR=>, well off a four-year low of
$1.1875 hit on June 7.
Beijing set the yuan's daily mid-point <CNY=SAEC> at the
highest since the July 2005 revaluation, pushing it up 0.6
percent this week. However, market reaction was limited, with
many traders resigned to the view that the yuan's appreciation
in the spot market <CNY=CFXS> will be slow and managed.
(Additional reporting by Kelvin Soh; Editing by Jan Dahinten)
