Asian stocks rose, with the regional benchmark index set to match its longest streak of weekly advances, after U.S. economic reports beat estimates and optimism increased that Greece will get a second debt bailout, boosting demand for riskier assets.
Honda Motor Co. (7267), the carmaker that generates 44 percent of its revenue in North America, rose 2.4 percent in Tokyo. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s biggest lender, led financial companies higher. Billabong International Ltd. (BBG), a global surfwear maker, surged 46 percent in Sydney after confirming a takeover approach.
The MSCI Asia Pacific Index gained 1.1 percent to 127.23 as of 8:02 p.m. in Tokyo. The measure has advanced 1.9 percent this week, extending its winning streak to the longest since December 2005. The gauge has advanced nine consecutive weeks only three times since 1988.
“It’s a distinct improvement from the fourth quarter last year from the perspective of investor confidence and risk appetite,” said Prasad Patkar, who helps manage about $1 billion at Platypus Asset Management Ltd. in Sydney. “When there’s a bit of relief from the European front, the markets can focus on fundamentals, which seem to be improving by the day.”
Japan’s Nikkei 225 Stock Average rose 1.6 percent, its biggest weekly gain since the period ended Dec. 2, as the yen fell against all of its 16 major counterparts. The currency declined to a four-month low after the Bank of Japan surprised the market on Feb. 14 by expanding its government bond purchases. A weaker yen boosts the overseas earnings of Japanese companies.
Australia’s S&P/ASX 200 added 0.3 percent, and South Korea’s Kospi Index advanced 1.3 percent. Hong Kong’s Hang Seng Index gained 1 percent, while the Shanghai Composite Index was little changed after swinging between gains and losses.
Futures on the Standard & Poor’s 500 Index were little changed today. The gauge advanced 1.1 percent in New York yesterday after reports showed Americans filed the fewest claims for jobless benefits since March 2008 and builders broke ground on more houses than expected. Manufacturing (OUTFGAF) in the Philadelphia region expanded this month at the fastest pace in four months as orders and sales rose.
Exporters to the U.S. advanced. Honda gained 2.4 percent to 2,950 yen. James Hardie Industries SE (JHX), a building-materials supplier that gets 68 percent of sales from the U.S., rose 2.3 percent to A$7.26 in Sydney. Techtronic Industries Co. (669), a power- tool maker that counts North America as its largest market, added 3.1 percent to HK$10.10 in Hong Kong.
Financial companies contributed the most to gains in the MSCI Asia Pacific Index amid optimism Europe’s debt crisis won’t throw the global financial system into disarray.
Euro-area officials said the European Central Bank is swapping its Greek bonds for new securities to protect from losses in a debt restructuring. European governments are considering cutting interest rates on emergency loans to Greece and using contributions from the ECB to plug a new financing gap in the second bailout for Athens, two people familiar with the discussions said.
“The sense of worry is weakening slightly in markets across the board,” said Hisakazu Amano, who helps oversee the equivalent of $29 billion at T&D Asset Management Co. in Tokyo. “Expectations for a U.S. economic recovery are increasing and the uncertainties on the European debt issues are subsiding.”
TPG Eyes Billabong
Mitsubishi UFJ Financial Group advanced 1.3 percent to 406 yen. Nomura Holdings Inc. (8604), Japan’s biggest brokerage by market value, rose 3.3 percent to 345 yen. HSBC Holdings Plc (HSBA), Europe’s No. 1 lender, climbed 1.7 percent to HK$70.50.
Billabong International jumped 46 percent to A$2.62 after it received a takeover approach from buyout firm TPG Capital valuing the company at A$765 million ($824 million). The interest comes less than two months after the apparel maker started a review of its capital structure amid a slump in earnings and looming debt payments.
The Asia Pacific index gained 11 percent this year through yesterday, compared with an 8 percent advance by the S&P 500 and an 8.1 percent increase by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 14.4 times estimated earnings on average, compared with 13 times for the S&P 500 and 10.9 times for the Stoxx 600.
Of 467 companies listed in the Asia Pacific index that have reported net income since Jan. 9, 256 missed analysts’ estimates while 126 beat them, according to data compiled by Bloomberg.
Bridgestone Corp (5108), the world’s biggest tiremaker by market value, jumped 4 percent to 1,833 yen after saying it expects net income to surge 63 percent to 168 billion yen ($2.1 billion) this year on growing sales. The Japanese tire company also said it will spend about 4.7 billion yen to boost production capacity.
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