SINAGPORE, July 27 — Asian stocks extended losses into a fourth day following the worst week for global equities this year amid a selloff in commodities and the rallying dollar.

Oil and gold retreated as copper dropped to near a six-year low.

The MSCI Asia Pacific Index declined 0.6 per cent by 9:26 a.m. in Tokyo as Japan’s Topix index slid 1 per cent. Standard & Poor’s 500 Index futures were little changed following a slump in US stocks Friday.

American oil fell 0.2 per cent, with Brent trading below US$55 (RM210) a barrel.

Gold also slipped 0.2 per cent after its longest run of weekly losses since 2012. Copper lost 0.3 per cent and the South Korean won sank to a three-year low.

China reports on industrial company profits today, potentially providing further clues on an economic slowdown that has fueled the collapse in commodity prices.

Gold is trading near a five-year low and oil is in a bear market amid concern raw-material supplies are outpacing demand. In the US, data on durable and capital goods orders are due, with investors looking ahead to this week’s meeting of the Federal Reserve.

“These are tough times if you’re a gold bug or an oil baron. The lead from Friday night is not one of optimism,” Evan Lucas, a markets strategist in Melbourne at IG Ltd, wrote in an e-mail to clients.

“In fact, the FOMC may even be a little more cautious about the current market and economic conditions. This would see a quick unwind in oversold markets,” he said, referring to the Fed Open Market Committee, due to meet tomorrow.

Commodity rout

Disappointing reads on Chinese and European manufacturing Friday sparked renewed selling of commodity-linked currencies, with the Aussie returning to its weakest level since May 2009 and the Brazilian real tumbling 2.1 per cent to its lowest price since 2003.

Canada’s dollar was near its weakest since 2004.

Crops, industrial metals and crude led the Bloomberg Commodity Index 1.2 per cent lower on Friday, extending its more- than 13-year low. The S&P 500 sank 1.1 per cent, capping a weekly drop of 2.2 per cent, the most since March.

In the US Friday, purchases of new homes unexpectedly retreated in June and prior readings were revised down, painting a picture of less robust improvement during the industry’s busiest time of year.

Amid the disappointing economic data, investors sifted through corporate profit reports. The earnings season has so far been spotty for US companies, with sluggish demand overseas damping returns for multinational companies at the same time the dollar has strengthened to near the highest level since April.

Earnings malaise

From Apple Inc to Caterpillar Inc and Microsoft Corp, a parade of blue chips have disappointed investors in the past two weeks.

The impact is having the biggest impact on the Dow Jones Industrial Average, giving it the worst week since January.

Analysts are calling for a 4 per cent drop in second-quarter profit for S&P 500 companies, shallower than July 10 estimates for a 6.4 per cent decline.

“Certainly the ongoing collapse in commodity prices emanating from weak data in China and weak earnings reports from companies because of China, such as Caterpillar, are weighing on the market,” Jim Paulsen, Minneapolis-based chief investment strategist at Wells Capital Management Inc said last week.

His firm oversees US$351 billion.

“We’ve got a pretty big collapse going on here.” — Bloomberg