Asian Energy Stocks Advance on U.S. Jobs Report; Chubu Electric Tumbles
Asian energy-related stocks climbed after U.S. jobs growth boosted confidence in the world’s largest economy and halted a rout of commodity prices, offsetting declines among Japanese power companies.
Cnooc Ltd., China’s largest offshore oil producer, climbed 1.8 percent in Hong Kong as oil rebounded from the biggest weekly decline since 2008. Santos Ltd. (STO), Australia’s third- largest oil and gas producer, advanced 1.7 percent in Sydney. Kirin Holdings Co., Japan’s No. 2 brewer by volume, led declines among companies whose earnings have suffered since the country’s March earthquake. Chubu Electric Power Co. slumped 10 percent in Tokyo after Japan’s Prime Minister Naoto Kan asked the utility to shut its Hamaoka nuclear plant.
“The stronger-than-expected payroll report tells us that the U.S. economic recovery is becoming more sustainable,” said Shane Oliver, head of investment strategy at AMP Capital Investors Ltd., which manages $98 billion in Sydney. “More jobs means more spending, means more profits, means more jobs, and so on. Japan’s economy will obviously do it tougher than expected this half year.”
The MSCI Asia Pacific Index was little changed at 137.64 as of 7:03 p.m. in Tokyo, with about the same number of stocks rising as declining.
The Asia-Pacific gauge sank 1.4 percent last week after central banks from India to the Philippines raised interest rates and U.S. reports ahead of Friday’s employment data suggested the country’s economic recovery was slowing.
Japan’s Nikkei 225 (NKY) Stock Average slipped 0.7 percent, dropping for a second straight day on speculation the government’s request to shut the nuclear reactor, located close to an earthquake fault-line, may hurt the economy. Australia’s S&P/ASX 200 Index rose 0.3 percent, while Hong Kong’s Hang Seng Index gained 0.8 percent, snapping its longest streak of daily declines since 2003.
Futures on the Standard & Poor’s 500 Index added 0.4 percent today. In New York, the index advanced 0.4 percent on May 6 as a government report showed the U.S. economy added more jobs than forecast in April, easing concern that higher fuel prices are slowing a recovery.
Payrolls increased by 244,000 workers last month, the biggest gain since May 2010, after a revised 221,000 increase the prior month, the U.S. Labor Department said. Economists projected an April increase of 185,000, according to the median estimate in a Bloomberg News survey. Employment excluding government jobs jumped the most in five years, while the jobless rate rose to 9 percent, the first increase since November.
In Hong Kong today, Cnooc gained 1.8 percent to HK$18.30, while PetroChina Co., the nation’s largest oil company, advanced 1.7 percent to HK$10.66. BHP Billiton Ltd., Australia’s biggest oil producer, rose 0.4 percent to A$44.75 in Sydney, while Woodside Petroleum Ltd. (WPL), Australia’s second-biggest oil and gas producer, gained 1.2 percent to A$45.85. Santos advanced 1.7 percent to A$14.71.
A measure of energy stocks on the Asia-Pacific gauge advanced the most among 10 industry groups as oil futures climbed for the first day in six. Crude for June delivery rose as much as 3.1 percent in electronic trading on the New York Mercantile Exchange after slumping 14.7 percent last week, the biggest decrease since December 2008.
Jiangxi Copper Co., China’s No. 1 producer of the metal, climbed 1.9 percent to HK$24.55 in Hong Kong after copper in London gained as much as 1.4 percent today. Rio Tinto Group, the world’s second-largest mining company by sales, added 0.6 percent to A$80.01 in Sydney.
HSBC Holdings Plc (5), Europe’s biggest bank by market value, climbed in Hong Kong after Greece denied it was considering leaving the euro. HSBC rose 1.6 percent to HK$84, while Billabong International Ltd. (BBG), a surf-wear maker that gets more than a fifth of its sales in Europe, gained 1.5 percent to A$6.73 in Sydney.
European Union leaders showed their resolve in keeping the euro region together, agreeing in an unannounced meeting last week to ease the terms of the 110 billion-euro ($158 billion) lifeline that Greece received last year.
Greece Exit ‘Unrealistic’
The euro tumbled 3.45 percent in the final two days last week, the biggest back-to-back loss since 2008, as Der Spiegel magazine said Greece may withdraw from the currency bloc. EU officials denied the report and said Greece will need more aid.
“It is highly unrealistic that Greece will leave the European Union,” said Tim Schroeders, Melbourne-based manager at Pengana Capital Ltd., which oversees about A$1 billion.
Spotless Group Ltd. (SPT), a corporate-services provider that grew from one dry-cleaning store in 1946, soared 13 percent to A$2.20 in Sydney after receiving a takeover bid from a private- equity firm. The provider of facilities management, food and cleaning services in more than 30 countries didn’t name the suitor, and said the offer was too low.
Chubu Electric plunged 10 percent to 1,584 yen in Tokyo today, leading power and gas companies to the steepest decline among 33 industry groups in Japan’s broader Topix index.
Prime Minister Kan on May 6 asked the nation’s third- biggest utility to shut its Hamaoka power plant, citing a government study showing an 87 percent likelihood of a magnitude-8 quake striking the area within 30 years. It’s the first government request to close reactors since a temblor and tsunami hit northeastern Japan on March 11 and caused the world’s worst nuclear accident in 25 years.
Tohoku Electric Power Co., a utility based in Miyagi prefecture, northern Japan, sank 2.1 percent to 1,205 yen after Asahi newspaper reported it may post a full-year loss because power plants were damaged in the earthquake.
Kirin slipped 4 percent to 1,094 yen after saying charges linked to an earthquake-damaged factory contributed to a first- quarter loss.
Toyota Motor Corp., the world’s largest carmaker, retreated 0.5 percent to 3,195 yen.
“A lot of industrial-use products such as cars and electronics parts are produced in the Chubu district,” said Kazuhiro Takahashi, a general manager at Daiwa Securities Capital Markets Co. in Tokyo. “The uncertainty about the government measures toward nuclear power is a negative factor for stock prices.”
The Topix has declined about 8 percent through May 6 since March 10, the day before a magnitude-9 earthquake and tsunami devastated Japan’s northeast coast, disabled a nuclear power plant and disrupted supply chains at companies from Toyota to Canon Inc.
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