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By Bloomberg

Asian stocks fell as crude traded near a four-year low, and Chinese shares extended losses amid fading interest in the equity-trading link with Hong Kong.

Kunlun Energy Co. slid 2.9 percent in Hong Kong after oil futures traded near a four-year low. Materials shares led declines, with Fortescue Metals Group Ltd. tumbling 7.7 percent in Sydney as a bear market for iron ore deepened. Hong Kong Exchanges & Clearing Ltd. capped its biggest three-day drop since October 2011 as buy orders for Shanghai shares through the equity connect slowed to a trickle. Takata Corp. plunged to a five-year low after the U.S. demanded automakers expand recalls involving the company’s faulty air bags.

The MSCI Asia Pacific Index dropped 0.5 percent to 139.97 as of 4:12 p.m. in Hong Kong. The gauge climbed 5.2 percent from its October low through yesterday after the Bank of Japan unexpectedly added to monetary easing and the nation’s $1.1 trillion pension fund said it would buy more shares.

“We’re seeing a bit of consolidation as we’ve had a good rally from the October lows,” Shane Oliver, who helps oversee about $125 billion as Sydney-based head of investment strategy at AMP Capital Investors Ltd. “Valuations still look reasonable. Investors are probably just waiting for the next catalyst. We’ve had good news out of Japan and shares in Shanghai have rallied ahead of the start of the trading link with Hong Kong.”

China’s Shanghai Composite Index fell 0.2 percent, falling for a fifth day. Hong Kong’s Hang Seng Index slipped 0.7 percent to extend a three-week low, and the Hang Seng China Enterprises Index declined 0.4 percent. International investors bought about 2.6 billion yuan ($424.7 million) of Shanghai shares out of the 13 billion yuan daily limit under the link today, while mainland investors used 2.4% percent of their 10 billion yuan quota for Hong Kong stocks.

Regional Gauges

Australia’s S&P/ASX 200 Index slipped 0.6 percent. New Zealand’s NZX 50 Index rose 0.3 percent to extend a record high. South Korea’s Kospi closed little changed. India’s S&P BSE Sensex index lost 0.1 percent. Taiwan’s Taiex index advanced 1.2 percent. Singapore’s Straits Times Index climbed 0.6 percent.

Japan’s Topix index added 0.1 percent. Prime Minister Shinzo Abe postponed a planned sales-tax increase, called a snap election and ordered his ministers to start preparing a stimulus package. Japan’s parliament will be dissolved on Nov. 21, Abe said at a press conference yesterday after the close in Tokyo, without giving an election date. The BOJ announced after its monthly policy meeting today that it would keep its stimulus program unchanged after a surprise boost at the end of last month.

“We foresee a continued rally in Japanese equities,” Khiem Do, who helps oversee about $60 billion as Hong Kong-based head of Asian multi-asset strategy at Baring Asset Management Ltd., said by phone. “Earnings in Japan will continue to improve amid the continuation of quantitative easing, weaker yen and economic reforms. The economy had a big hiccup due to the sales-tax hike in April. Now that that is out of the way, we can see earnings will improve.”

U.S. Stocks

Futures on the Standard & Poor’s 500 Index fell 0.2 percent. The U.S equity benchmark index climbed 0.5 percent yesterday to close at an all-time high amid speculation the world’s biggest economy is strong enough to overcome a global slowdown.

A report yesterday showed U.S. wholesale prices unexpectedly increased in October as higher costs for services and food outweighed a slump in energy. Investors are watching data from inflation to hiring and economic growth to determine the timing of any Federal Reserve interest-rate increase. The central bank releases minutes from its Oct. 28-29 meeting today.