Asian stocks mixed ahead of US debt talks

Commodity stocks fell across Asia, with the regional aggregate set for its first weekly decline in four, after Standard & Poor’s joined Moody’s in saying it may cut the US’s credit rating. The US Federal Reserve ruled out immediate further bond purchases, driving down oil and metal prices yesterday. The MSCI Asia Pacific Index was little changed at 135.78 at noon in Tokyo.

Asian markets opened to news by S&P, saying there was at least a 50% chance it will lower the U.S. AAA rating within 90 days, citing the risk of a stalemate enduring beyond any near-term agreement to raise the nation’s debt ceiling. Japan’s Nikkei 225 (NKY) Stock Average rose 0.2%. South Korea’s Kospi Index gained 0.4%. Australia’s S&P/ASX 200 Index fell 0.3%. Hong Kong’s Hang Seng Index dropped 0.3%, led by developers after China said it’s seeking to limit residential property prices in smaller cities.

In economic news, foreign direct investment in China rose 18.4% in the first half of the year as companies such as Nestle SA and Ford Motor Co. boosted their presence in the world’s fastest-growing major economy. Foreign investment climbed to $60.9 billion in the first six months from a year earlier, the Ministry of Commerce said in a statement today. Inbound investment gained 2.8% in June from a year earlier to $12.86 billion, the ministry said.

Cheung Kong Infrastructure (CKI) controlled by billionaire Li Ka-shing, fell the most in more than two years in Hong Kong trading after announcing a HK$3.4 billion ($436 million) share-sale plan. CKI dropped as much as 7%, the most since October 2008, and traded down 5.6% at HK$41 in early morning trade. The slide followed CKI’s announcement to the Hong Kong stock exchange today that it plans to sell 84.5 million shares at HK$40.41 each for general funding. The placing price is a discount of 7% to yesterday’s closing price of HK$43.45.

In Australia, BHP Billiton was 1.9% lower after announcing a US$12.1bn offer for Petrohawk energy. Petrohawk operates three leading shale gas and oil projects in the US. BHP’s all-cash offer implies a 65% premium to Petrohawk’s last closing share price. Iron ore producer Fortescue Metals Group fell 1.6% after announcing its second quarter production numbers.