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Asian Stocks Head for Highest Close Since May on BOJ

Asian stocks rose, with a regional benchmark index poised to close at the highest level since May, as the Bank of Japan boosted asset purchases, joining moves by the Federal Reserve last week to stimulate economic growth.

JFE Holdings Inc. (5411), Japan’s second-biggest steelmaker, climbed 2.1 percent after the BOJ moved to prevent a rising yen from undermining an economic recovery. Nissan Motor Co. advanced 3.7 percent, recovering some of yesterday’s losses, as the carmaker resumed production in China after violent protests targeting Japanese companies in a dispute over control of a group of islands. Japan Airlines Co. rose 1.1 percent on its first day of trading following the largest initial public offering since Facebook Inc.

The MSCI Asia Pacific Index (MXAP) rose 0.6 percent to 123.79 as of 7:13 p.m. in Tokyo, poised for the highest close since May 4. More than two stocks advanced for each that fell. The gauge gained 8.1 percent this year through yesterday amid speculation central banks will step up measures to support economic growth.

“The BOJ seems to have gone above and beyond,” said Soichiro Monji, chief strategist at Tokyo-based Daiwa SB Investments Ltd., which manages the equivalent of about 5 trillion yen ($64 billion). “I didn’t expect them to move this time.”

Japan’s Nikkei 225 Stock Average rose 1.2 percent and the broader Topix Index gained 0.9 percent as the <a href=``custom:blpnews:linkid=36TTALURLUT5'' tooltip=``BOJ Portal: BOJ''>BOJ</a> increased its asset-purchase fund to 55 trillion yen from 45 trillion yen and its lending facility was kept at 25 trillion yen. Five of 21 analysts surveyed by Bloomberg News predicted easing while 11 forecast the action by October.

U.S. Futures

This year’s gain on the Asian gauge <a href="news:linkid=MAKNAJ6S972F">compares</a> with a 16 percent increase on the S&P 500 through yesterday and a 12 percent advance for the Stoxx Europe 600 Index. The Asian benchmark traded at 12.8 times estimated earnings compared with 14.1 for the S&P 500 and 12.1 for the Stoxx Europe 600 Index.

<a href=``custom:blpnews:linkid=MG8V1353F5I9'' tooltip=``Worldwide Equity-Index Futures: WEIF''>Futures</a> on the Standard & Poor’s 500 Index advanced 0.1 percent today. Most stocks on the U.S. gauge fell yesterday as FedEx Corp. slumped and concern grew that European leaders will struggle to resolve the region’s debt crisis.

South Korea’s Kospi Index climbed 0.2 percent and Singapore’s Straits Times Index rose 0.3 percent. Australia’s <a href="news:linkid=MAKNAJ6S972H">S&P/ASX 200 Index</a> gained 0.5 percent and Taiwan’s Taiex Index advanced 0.6 percent. Hong Kong’s Hang Seng Index increased 1.2 percent and China’s Shanghai Composite added 0.4 percent.

China Policy

People’s Bank of China Governor Zhou Xiaochuan said his central bank will maintain the continuity and stability of monetary policies and at the same time make adjustments more forward-looking, targeted and effective, according to a commentary published in the Financial News.

Nissan gained 3.7 percent to 727 yen after saying it would resume operations at Chinese factories today. Japan’s three <a href=``custom:blpnews:linkid=9KC57N4RG9UT'' tooltip=``Top 100 Global Automakers: EQS /SAMPLE 8253334 /RESULTS''>biggest carmakers</a> -- Toyota Motor Corp., Nissan and Honda Motor Co. -- halted production at Chinese plants this week amid attacks on their dealerships in the eastern Chinese port city of Qingdao. Officials at Suzuki, Mitsubishi Motors Corp. and Mazda Motor Corp. said they also were assessing the situation in China.

Toyota climbed 1.9 percent to 3,255 yen and Honda rose 2.7 percent to 2,674 yen.

Automakers have been among the hardest hit Japanese companies in the diplomatic crisis. The dispute puts at risk bilateral trade in goods ranging from rice to tractors that has tripled in the past decade to more than $340 billion. The tensions also further complicate policy makers’ efforts to fortify growth in Asia’s biggest economies as the European debt crisis saps demand for exports.

Trading Debut

Japan Airlines Co. rose 1.1 percent to 3,830 yen in Tokyo on its first day of <a href="news:linkid=MAKPY86S972J">trading </a>following a 663 billion yen initial public offering. JAL returned to the stock exchange following a bankruptcy and a turnaround that included shedding more than a third of its workforce, canceling routes and retiring older planes.

David Jones Ltd. slid 0.4 percent to A$2.26 in Sydney as net income plunged 40 percent. Stagnating sales and tightening profit margins have halved profits at the company since 2007, driving David Jones’ market value to an eight-year low compared with that of its assets.

Macmahon Holdings Ltd., an Australian engineering-services company, plunged 39 percent to 32 Australian cents, the most since 2009, after cutting its profit forecast for fiscal year 2013.

Thai Beverage PcL surged 13 percent to 39 Singapore cents, the most on record and heading for the highest closing level since it started trading in Singapore in May 2006. Heineken NV cleared the biggest hurdle in its fight to take over Asia Pacific Breweries Ltd. as billionaire stakeholder Charoen Sirivadhanabhakdi’s ThaiBev pledged support.

To contact the reporters on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net; Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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