Asian stocks fall on concern US rescue won't bolster growth

Tokyo: Asian stocks fell for a fifth day after Fortis received a $16 billion bailout and concern grew that a US rescue plan will fail to prevent more bank failures.

Sumitomo Mitsui Financial Group Inc., Japan's third-largest listed bank, lost 1 per cent as Belgium's Fortis received funds from three European governments and the UK prepared to shore up Bradford & Bingley Plc.

Mitsui OSK Lines Ltd. fell to the lowest in two years as shipping rates posted a record drop. President George W. Bush and congressional leaders said they reached an agreement on a $700 billion bank-rescue package.

The MSCI Asia Pacific Index lost 1.7 per cent to 111.85 as of 1:33pm in Tokyo. The index has tumbled 29 per cent this year as losses related to US subprime mortgages caused the collapse of Bear Stearns Cos. and Lehman Brothers Holdings Inc. Wachovia Corp. is in talks to sell itself to Citigroup Inc. and Wells Fargo & Co., the Wall Street Journal reported on Monday.

Most benchmark indexes in Asia dropped. Japan's Nikkei 225 Stock Average lost 0.9 per cent to 11,792.25. Seven & I Holdings Co., operator of Japan's largest convenience store chain, climbed 4 per cent as investors moved into companies whose profits are sheltered from weakening growth.

Futures on the US Standard & Poor's 500 Index declined 0.8 per cent on Monday. US stocks tumbled the most in four months last week, with the S&P 500 losing 3.3 per cent, on concern Congress wouldn't pass the rescue plan.

US political leaders said on Sunday they have reached an agreement that will allow the Treasury to purchase bad securities from banks.

It will also limit executive compensation at some participating financial institutions as well as provide guarantees to protect the government from excess losses.