Asian Stocks Rise on Japanese Economic Growth, U.S. Jobless Claims Reports

Asian stocks rose, lifting the MSCI Asia Pacific Index to its second straight weekly advance, as Japan boosted its estimate for second-quarter economic growth and fewer people applied for jobless benefits in the U.S.

Toyota Motor Corp., the world’s largest automaker, gained 0.7 percent in Tokyo. Samsung Electronics Co., Asia’s biggest maker of chips, flat screens and mobile phones, advanced 1.3 percent in Seoul. Canon Inc., the world’s largest camera maker, jumped 5.6 percent after the company announced a share buyback. Industrial & Commercial Bank of China Ltd. declined 0.5 percent in Hong Kong on speculation China’s government may intensify measures to curb real-estate prices.

About two stocks advanced for each one that fell in the MSCI Asia Pacific Index, which gained 0.4 percent to 121.96 as of 6:55 p.m. in Tokyo. The measure has climbed 5.2 percent from a one-month low on Aug. 25 amid speculation the U.S. will avoid slipping back into recession. The gauge rose 1.6 percent in the past five days, adding to last week’s 2.7 percent gain.

“The question you should ask yourselves is what could go right from here, rather than what could go wrong,” said Paul Xiradis, who manages about $10 billion as chief executive officer of Ausbil Dexia Ltd. in Sydney. “We could see a big swing-around back into some riskier assets, and, given the positioning of the market, it could be quite powerful.”

Japan’s Nikkei 225 Stock Average jumped 1.6 percent as Prime Minister Naoto Kan unveiled details of a 920 billion yen ($11 billion) stimulus plan to boost consumption and create jobs.

Jobless Benefits

The Kospi index climbed 1 percent in Seoul, Hong Kong’s Hang Seng Index rose 0.4 percent and China’s Shanghai Composite Index advanced 0.3 percent. Exchanges in Singapore, India, Indonesia, the Philippines, Malaysia, Sri Lanka and Pakistan were closed for holidays.

Futures on the Standard & Poor’s 500 Index rose 0.1 percent. The U.S. index gained 0.5 percent yesterday as a government report showed initial claims for unemployment benefits dropped by 27,000 to 451,000 last week, lower than the median estimate of 470,000 in a Bloomberg survey of economists. A separate report showed the U.S. trade deficit narrowed in July by the most since February 2009.

In Japan, a Cabinet Office report showed that gross domestic product grew at an annualized 1.5 percent rate in the three months ended June 30, faster than the 0.4 percent reported last month. The figure matched the median of 21 estimates in a Bloomberg News survey of economists.

Toyota climbed 0.7 percent to 2,951 yen. Samsung Electronics, which receives about 85 percent of its sales outside of South Korea, gained 1.3 percent to 766,000 won in Seoul. Li & Fung Ltd., the biggest supplier to retailers including Wal-Mart Stores Inc., jumped 2.9 percent to HK$43.20.

Biggest Contributors

Canon rose 5.6 percent to 3,750 yen. The company said yesterday it will buy back as much as 1.2 percent of its outstanding shares for as much as 50 billion yen ($598 million).

Technology stocks as a group including Canon and Samsung were the biggest contributors to the MSCI Asia Pacific Index’s advance, according to data compiled by Bloomberg.

Improved prospects for the U.S. economy also caused the dollar to strengthen versus the yen, boosting the value of sales generated overseas in local terms for Japanese companies. The dollar appreciated to as much as 84.29 yen from 83.64 at the close of stock trading in Tokyo yesterday.

A “recovery in corporate earnings in the U.S. is driving an increase in employment in the private sector,” said Juichi Wako, a senior strategist at Tokyo-based Nomura Holdings Inc. “Concern about the economy has eased.”

Home Sales

The MSCI Asia Pacific Index slumped as much as 5.3 percent from a three-month high on Aug. 6 as slower-than-estimated growth in U.S. incomes and a record plunge in the country’s home sales fueled concerns about global economic growth.

The index gained this week as U.S. and Australian jobs data beat economist estimates and demand improved for European government debt. Investors added a net $8.43 billion to equity funds in the week ending Sept. 8, the most in six weeks, as stocks rallied on signs that the global economy will avoid slipping back into a recession, according to data from research firm EPFR Global.

Stocks in the MSCI Asia Pacific Index are valued at an average 13.9 times estimated earnings, higher than the S&P 500 Index’s 13.2 times and 11.9 times for the Stoxx Europe 600 Index.

GS Holdings

Some companies rose after brokerage upgrades. GS Holdings Corp., the parent of South Korea’s No. 2 refiner GS Caltex Corp., gained 6.6 percent to 54,700 won in Seoul, the highest level since January 2008 and the second-biggest increase on the MSCI Asia Pacific Index. Deutsche Bank AG boosted its share-price estimate to 680,000 won from 50,000 won and maintained its “buy” rating on the stock.

Novatek Microelectronics Corp., which makes integrated circuits in Taiwan, jumped 5.5 percent to NT$83.90 after UBS AG raised its recommendation to “buy” from “neutral.”

Lotte Shopping Co., South Korea’s biggest department-store owner, advanced 2.1 percent to 464,500 won. CLSA Asia Pacific Markets boosted its rating on the stock to “outperform” from “underperform” and increased its share estimate on the company to 480,000 won from 380,000 won.

Also in South Korea, Woori Finance Holdings Co., the nation’s third-largest financial company by market value, advanced 2.7 percent to 13,550 won in Seoul. National Pension Service, South Korea’s biggest investor, said it is open to teaming with Hana Financial Group Inc. or joining others to buy a stake in Woori Finance.

Tightening Measures

The MSCI Asia Pacific Index pared gains today after rising as much as 0.6 percent, as speculation grew China may implement more tightening measures.

China’s property prices rose 9.3 percent in August from a year earlier, China Information News reported, signaling officials may extend a crackdown on speculators and multiple home purchases. Also, the nation brought forward the release of August economic indicators by two days, prompting speculation that the central bank may raise the deposit rate to combat the erosion of savings by inflation, according to BOC International (China) Ltd. analyst Chen Jianbo.

Industrial & Commercial Bank of China, the world’s largest bank, declined 0.5 percent to HK$5.78 in Hong Kong, the second- biggest drag on the Hang Seng Index. China Mobile Ltd., the world’s biggest phone carrier by market value, lost 1.2 percent to HK$76.50. China Vanke Co., the nation’s largest publicly traded developer, dropped 1.4 percent to 8.16 yuan in the southern Chinese city of Shenzhen.

“There’s concern that the government may take bigger actions against the property market going forward,” said Wang Zheng, chief investment officer at Jingxi Investment Management Co. in Shanghai. “A slowdown in price increases isn’t enough and what they want to see is a price decrease.”

Iron-Ore Imports

Some raw-material producers declined today as China’s General Administration of Customs figures showed iron-ore imports by China, the largest buyer of the steelmaking ingredient, plunged 13 percent in August for the biggest decline in seven months.

BHP Billiton Ltd., which counts China as its biggest market and gets 19 percent of its revenue from iron ore, sank 0.6 percent to A$37.96 in Sydney.

Fortescue Metals Group Ltd., Australia’s third-biggest producer of iron ore, declined 2.2 percent to A$4.81. Baoshan Iron & Steel Co., the listed unit of China’s second-biggest steelmaker, retreated 0.3 percent to 6.69 yuan in Shanghai.

To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net

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