Asian Stocks Snap Three-Day Losing Streak on Stronger U.S. Economic Data
Asian stocks (MXAP) rose, snapping three days of losses, after U.S. data on manufacturing and jobless claims beat estimates, easing concern Europe’s debt crisis will drag the global economy into a recession.
Samsung Electronics Co. (005930), South Korea’s biggest exporter of consumer electronics, increased 3 percent in Seoul. DeNA Co. led Japanese internet companies higher after Nomura Holdings Inc. recommended investors “buy” stocks in the industry. China Overseas Land & Investment Ltd. (688), the biggest mainland developer listed in Hong Kong, jumped 5.5 percent after a report banks are offering lower mortgage rates.
“The U.S. economy is ending the year in a bit better shape than people had anticipated, and that is good, but Europe is obviously not,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $150 billion. “The European economy is heading toward recession next year, and I think it’s going to continue to weigh on markets.”
The MSCI Asia Pacific Index rose 0.8 percent to 112.39 as of 7:44 p.m. in Tokyo, with almost three shares rising for every two that fell. The gauge is set for a 2.3 percent loss this week after Moody’s Investors Service and Fitch Ratings warned Europe faces lower credit ratings as it struggles to rein in debt.
Japan’s Nikkei 225 Stock Average added 0.3 percent, while South Korea’s Kospi Index gained 1.2 percent. Australia’s S&P/ASX 200 rose 0.5 percent.
China’s Shanghai Composite Index climbed 2 percent on speculation the government will ease lending curbs to prevent the economy from slowing further. Hong Kong’s Hang Seng Index climbed 1.8 percent.
Futures on the Standard & Poor’s 500 Index (SPXL1) gained 0.7 percent today. The index rose 0.3 percent in New York yesterday after U.S. initial jobless claims fell last week to the lowest level since May 2008. Stocks also advanced as reports showed manufacturing in the New York and Philadelphia regions expanded more than forecast in December.
Samsung Electronics gained 3 percent to 1.045 million won in Seoul. Hyundai Motor Co. (005380), South Korea’s biggest carmaker, climbed 2.5 percent to 208,500 won. Li & Fung Ltd. (494), a supplier of toys and clothes to Wal-Mart Stores Inc., advanced 1.2 percent to HK$14.72 in Hong Kong.
Japanese internet companies rallied after Nomura said demand for e-commerce services is growing as more people are making online transactions using their smartphones.
DeNA, a social media site operator, jumped 5.2 percent to 2,302 yen. CyberAgent Inc. (4751), an online advertising company, rose 4.2 percent to 248,300 yen. Kakaku.com Inc. (2371), a price comparison website, added 0.8 percent to 2,798 yen.
Chinese banks and developers gained after Securities Times reported banks in Shenzhen are joining lenders in Beijing and Shanghai in offering lower mortgage rates for first-home buyers.
China Overseas Land, the biggest mainland developer listed in Hong Kong, gained 5.5 percent to HK$14.32. China Resources Land Ltd. (1109), a state-owned real estate company, advanced 9.1 percent to HK$13. Industrial & Commercial Bank of China Ltd., the nation’s biggest lender, rose 1.8 percent to HK$4.65.
Gains in stocks were limited today after International Monetary Fund Managing Director Christine Lagarde said yesterday that Europe’s crisis is “escalating.” Separately, European Central Bank President Mario Draghi said there is no “external savior” for governments in the region. The bank’s program of buying bonds from countries such as Italy and Spain is “neither eternal nor infinite,” he said.
The MSCI Asia Pacific Index declined 19 percent this year through yesterday, compared with a 3.3 percent drop by the S&P 500 and a 15 percent loss by the Stoxx Europe 600 Index. Stocks in the Asian benchmark were valued at 12.5 times estimated earnings on average, compared with 12.3 times for the S&P 500 and 10.2 times for the Stoxx 600.
Among stocks that dropped, JB Hi-Fi Ltd. (JBH) slumped 15 percent to A$12.71 in Sydney. The company said yesterday earnings before interest and tax will decline about 5 percent from a year earlier in the six months ending Dec. 31. The statement triggered downgrades from Citigroup Inc., Credit Suisse Group AG, JPMorgan Chase & Co., UBS AG and Linwar Securities. Rival Harvey Norman Holdings Ltd. (HVN) sank 6.9 percent to A$1.955.
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