Japanese, Australia Stock Futures Gain on Bernanke Pledge, Weakening Yen
Japanese and Australian stock futures rose after Federal Reserve Chairman Ben S. Bernanke pledged to safeguard the economic recovery, and the yen weakened ahead of an emergency Bank of Japan meeting.
American depositary receipts of Sony Corp., an electronics maker that earns more than 70 percent of sales outside of Japan, gained 1.4 percent from the closing share price in Tokyo. Those of Toyota Motor Corp., the world’s largest carmaker, rose 1 percent as the yen also weakened after Japan Prime Minister Naoto Kan said he is ready to take bold action and Bank of Japan Governor Masaaki Shirakawa returned to Tokyo from the U.S. to hold a policy meeting today. ADRs of BHP Billiton Ltd., the world’s biggest mining company, and Woodside Petroleum Ltd., Australia’s No. 2 oil and gas producer, rose 0.1 percent after commodity prices advanced.
“The BOJ’s emergency meeting is being held earlier than the market had expected,” said Tomochika Kitaoka, a senior strategist at Mizuho Securities Co. in Tokyo. “The market had expected Japanese authorities wouldn’t intervene to weaken the currency until the policy meeting scheduled on the 6th and 7th.”
Futures on Japan’s Nikkei 225 Stock Average expiring in September closed at 9,080 in Chicago on Aug. 27, compared with 8,980 in Singapore. They were bid in the pre-market at 9,090 in Osaka, Japan, at 8:05 a.m. local time. Futures on Australia’s S&P/ASX 200 Index advanced 0.9 percent today. New Zealand’s NZX 50 Index rose 0.6 percent in Wellington.
S&P Futures
Futures on the Standard & Poor’s 500 Index rose 0.3 percent today. In New York, the index gained 1.7 percent on Aug. 27 as Federal Reserve Chairman Bernanke vowed to safeguard the recovery and growth in gross domestic product slowed less than estimated.
The S&P 500 briefly erased gains as a gauge of consumer confidence trailed estimates, Bernanke spoke in Jackson Hole, Wyoming, and Intel Corp. cut its sales forecast at the same time in New York. The Thomson Reuters/University of Michigan index of U.S. consumer sentiment for August rose to 68.9, less than the median economist forecast of 69.6, from an eight-month low of 67.8 in July.
The yen dropped after Federal Reserve Chairman Bernanke’s pledge to safeguard the economic recovery dampened investor appetite for haven currencies. The yen also weakened after Kan said Japan is willing to take bold action to reduce its value.
The yen depreciated to as low as 85.46 against the dollar, compared with 84.63 at the close of stock trading in Tokyo on Aug. 27. Against the euro, Japan’s currency weakened to 109.03 from 107.71. The weaker yen boosts income at Japanese companies when overseas revenue is converted into local currency.
BOJ Meeting
Shirakawa returned to Tokyo yesterday, cutting short a visit to the U.S., where he was attending a Federal Reserve event in Wyoming, following reports the central bank is considering holding an emergency meeting as early as Aug. 30 to discuss policy easing measures that could help weaken the yen, Dow Jones reported, citing people familiar with the situation.
The Bank of Japan will hold an emergency policy meeting at 9 a.m. Japan time today, according to an e-mailed notice from the central bank.
Crude oil for October delivery rose 2.5 percent in New York on Aug. 27. The London Metal Exchange Index of six metals including copper and zinc advanced 2.1 percent on Aug. 27.
The MSCI Asia Pacific Index has fallen 9.5 percent from its high this year on April 15 on concern Europe’s debt crisis and China’s steps to curb property prices will slow global economic growth. Stocks in the index trade at 13.4 times estimated earnings on average, compared with 12.8 times for the Standard & Poor’s 500 Index and 11.3 times for the Stoxx Europe 600 Index.
To contact the reporter on this story: Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net; Kotaro Tsunetomi in Tokyo at ktsunetomi@bloomberg.net.
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