Most Asian Stocks Advance on Japan Economic Growth, Commodities
A securities firm in Tokyo
Tomohiro Ohsumi/Bloomberg
Japan’s Nikkei 225 Stock Average gained 0.4 percent after a Cabinet Office report showed the nation’s economy grew at a 5 percent annual rate in the first quarter, compared with the 4.9 percent reported last month.
Japan’s Nikkei 225 Stock Average gained 0.4 percent after a Cabinet Office report showed the nation’s economy grew at a 5 percent annual rate in the first quarter, compared with the 4.9 percent reported last month. Photographer: Tomohiro Ohsumi/Bloomberg
Asian stocks rose the most in a week after data on Australian jobs and Japan’s economic growth beat estimates, easing concern that Europe’s debt crisis and China’s measures to curb property prices will slow a global recovery.
Commonwealth Bank of Australia gained 1.3 percent in Sydney after the country’s employers added workers in May. Dentsu Inc., Japan’s biggest advertising agency, rose 2.6 percent in Tokyo after the economy expanded more than initially estimated. BHP Billiton Ltd., Australia’s largest oil producer, increased 1.4 percent after crude prices rose. Sony Corp., a Japanese maker of electronics that gets 23 percent of sales in Europe, fell 1.6 percent. China Vanke Co., a developer, lost 2.1 percent.
“Macro data has been good and the signs of a modest recovery are on track,” said Nader Naeimi, a strategist in Sydney at AMP Capital Investors, which holds $90 billion. “Volatility has been settling down a bit compared to what it was.”
The MSCI Asia Pacific Index rose 1 percent to 110.94 as of 7:21 p.m. in Tokyo, with about seven stocks advancing for every three that declined. The gauge has retreated 14 percent from this year’s high on April 15 on concern debt crises among European countries will undermine a global economic recovery.
The drop cut the price of shares in the index to 14.3 times estimated earnings on average yesterday, near the lowest level since January 2009.
Australia’s S&P/ASX 200 Index and Japan’s Nikkei 225 Stock Average gained 1.1 percent. Hong Kong’s Hang Seng Index rose almost 0.1 percent, while China’s Shanghai Composite Index sank 0.8 percent.
Fed’s Beige Book
Futures on the Standard & Poor’s 500 Index climbed 0.5 percent. The index dropped 0.6 percent yesterday as the cost to protect against default by BP Plc rose to a record on concern over the fallout from the Gulf of Mexico oil spill. Stocks had gained earlier in the day, before the Federal Reserve’s Beige Book survey said economic growth was subdued.
Commonwealth Bank gained 1.3 percent to A$51.39. Woolworths Ltd., Australia’s biggest retailer, increased 1 percent to A$27.50. Telstra Corp., Australia’s largest phone company, gained 1 percent to A$3.18.
The number of people employed in Australia increased 26,900 in May from April, the statistics bureau said. The median estimate of 23 economists surveyed by Bloomberg News was for a gain of 20,000. The jobless rate fell to 5.2 percent from 5.4 percent.
Japan’s Economic Growth
Japan’s gross domestic product rose at an annualized 5 percent rate in the three months ended March 31, faster than the 4.9 percent reported in preliminary figures last month, the Cabinet Office said today in Tokyo. The median estimate of economists surveyed by Bloomberg News was for 4.2 percent. None of the analysts predicted faster growth.
Dentsu, which receives nearly 90 percent of its revenue domestically, rose 2.6 percent to 2,338 yen. Fanuc Ltd., a maker of factory controls, surged 6.2 percent to 10,230 yen and was the biggest contributor to the Nikkei 225. Secom Co., Japan’s largest security company, rose 1 percent to 3,975 yen.
In New Zealand, the NZX 50 Index climbed 0.1 percent. The central bank raised its benchmark interest rate for the first time in three years today, signaling that faster inflation is a bigger threat to growth than further gains in the nation’s currency.
‘Inflationary Pressures’
“Underlying inflationary pressures are expected to increase,” Reserve Bank Governor Alan Bollard said in a statement released in Wellington after boosting the official cash rate to 2.75 percent from a record-low 2.5 percent. “Given the current low level of the cash rate, it is therefore appropriate to gradually remove policy stimulus.”
Telecom Corp. of New Zealand Ltd. climbed 3.3 percent to NZ$1.87, the biggest contributor to the advance in the NZX 50 Index. Infratil Ltd., a New Zealand investor in energy and transport companies, gained 1.3 percent to NZ$1.61.
Energy and material companies, including oil and coal producers, gained the most among the 10 industry groups in the MSCI Asia Pacific Index.
BHP Billiton, which gets 15 percent of its revenue from petroleum, gained 1.4 percent to A$37.62, the leading contributor to the Asian index. Inpex Corp., Japan’s largest oil and gas explorer, jumped 3.9 percent to 555,000 yen. Cnooc Ltd., China’s biggest offshore oil explorer, increased 2.6 percent to HK$12.68, the second-biggest increase in Hong Kong’s Hang Seng Index.
Commodities, Euro
Crude oil rose for a third day after yesterday climbing by the most in almost two weeks to settle at $74.38 a barrel in New York. The London Metal Exchange Index of six metals including copper and zinc gained 2.4 percent yesterday.
Sony decreased 1.6 percent to 2,524 yen in Tokyo. LG Electronics Inc., South Korea’s second-largest electronics maker, which receives 22 percent of its revenue from Europe, slid 2.1 percent to 96,400 won in Seoul.
Goldman Sachs Group Inc. reversed a forecast for the euro to rise, saying it will fall to $1.15 in three months as the probability of “continued policy mishaps” encourages investors to sell the 16-nation currency.
The euro gained today after Reuters reported that the head of China’s pension fund said the 16-nation currency will survive Europe’s debt crisis. The euro strengthened to as much as 110.43 yen today from as low as 108.87 yesterday.
Chinese Property Prices
China Vanke, mainland China’s biggest publicly traded property developer, lost 2.1 percent to 7.15 yuan in Shenzhen. Poly Real Estate Group Co. dropped 2.2 percent to 11.05 yuan. Foxconn International Holdings Ltd., the world’s biggest contract maker of mobile-phones and which earns 71 percent of its revenue in China, fell 2.5 percent to HK$5.47 in Hong Kong.
China’s property prices rose 12.4 percent in May, the second-fastest pace on record, the National Bureau of Statistics said, showing little sign yet that government initiatives to curb an asset-price bubble are working. China’s exports jumped 48.5 percent in May from a year earlier, the biggest gain in more than six years, the customs bureau said. It surpassed all 32 estimates in a Bloomberg News survey of economists.
“Unless there is a double dip in the global economy, the government is likely to maintain a tight policy on the property industry,” Christina Chung, senior portfolio manager at RCM, which oversees $146 billion in assets worldwide, said in an interview. “The correction in property stocks may take a longer time to play out.”
To contact the reporter on this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net.
Rate These Stories
Rate this Page