Asian Stocks Rise on Draghi ECB Bond Pledge, U.S. Data
Asian stocks rose, with the benchmark regional index set to gain for the first week in three, after European Central Bank President Mario Draghi said the bank stands ready to buy bonds to ease the region’s debt crisis and as U.S. economic data beat estimates.
Brother Industries Ltd. (6448), a Japanese office-equipment maker that gets 28 percent of sales in Europe, advanced 2.5 percent. BHP Billiton Ltd., the world’s biggest mining company, rose 1 percent after a gauge of commodity prices yesterday climbed by the most in two months. LG Display Co. slid 4.5 percent in Seoul after Korea Investment & Securities cut its rating on the stock, saying television and notebook panel prices may fall.
The MSCI Asia Pacific Index added 0.4 percent to 122.84 as of 6:19 p.m. in Tokyo, with about five shares rising for each three that fell on the gauge. For the week, the index is headed for a 0.3 percent gain. Markets in China are closed for a holiday.
“At the moment, the market is telling us there won’t be an additional blowup or crisis in Europe in the near term,” said Donald Williams, Sydney-based chief investment officer at Platypus Asset Management Ltd., which manages about $1 billion. “Equity markets are turning up. It almost doesn’t matter which market you look at.”
Japan’s Nikkei 225 Stock Average rose 0.4 percent after falling earlier as the Bank of Japan maintained its asset- purchase plan at 55 trillion yen ($700 billion), preserving its policy firepower despite increased political pressure for more easing and signs of an economic contraction.
Australia’s S&P/ASX 200 Index added 0.9 percent to the highest level since August 2011. South Korea’s Kospi Index rose 0.1 percent and Hong Kong’s Hang Seng climbed 0.5 percent.
The MSCI Asia Pacific Index gained 7.9 percent this year through yesterday as policy makers boosted stimulus measures to counter a global economic slowdown and tame Europe’s debt crisis. The Asian benchmark trades at 12.9 times estimated earnings on average, compared with 13.9 times for the Standard & Poor’s 500 Index (SPXL1) and 12 times for the Stoxx Europe 600 Index.
The National Stock Exchange of India said 59 erroneous orders were responsible for a plunge and halt in trading today, briefly erasing about $58 billion in value from the stock market. Trading in the S&P CNX Nifty Index (NIFTY) and some individual companies halted at 9:49 a.m. local time for 15 minutes after the 50-stock measure plunged as much as 16 percent to 4,888.20.
Reliance Industries Ltd., owner of the world’s largest refining complex, and Housing Development Finance Corp., India’s biggest mortgage lender, both tumbled as much as 20 percent.
Asian exporters advanced. Brother Industries advanced 2.5 percent to 733 yen in Tokyo. Makita Corp., a Japanese power-tool maker that gets more than 40 percent of sales in Europe, climbed 1.5 percent to 3,085 yen.
ECB PresidentDraghi said the central bank is ready to start buying government bonds of indebted euro nations as soon as the necessary conditions are fulfilled. The ECB yesterday kept its benchmark interest rate unchanged at a historic low of 0.75 percent.
Futures on the S&P 500 fell 0.1 percent today. The gauge advanced 0.7 percent yesterday after the Labor Department said applications for jobless benefits increased 4,000 to 367,000 last week. Economists forecast 370,000 claims, according to a Bloomberg survey. Orders placed with U.S. factories fell 5.2 percent in August, compared with a forecast for a 5.9 percent decline.
A U.S. Labor Department report today may show the world’s biggest economy created 115,000 jobs last month, while the unemployment rate rose to 8.2 percent from 8.1 percent, according to economists’ estimates. The Federal Reserve in September pledged to buy mortgage-backed securities until the U.S. labor market recovers.
BHP Billiton rose 1 percent to A$33.32 after gains in crude oil and metals prices help drive the biggest advance since Aug. 3 for the Standard & Poor’s GSCI Spot Index of 24 raw materials. Rio Tinto Group, the world’s third-largest mining company, advanced 1.8 percent to A$54.90.
Discovery Metals Ltd. soared 14 percent to A$1.655, a second day of gains, after a Chinese private equity firm yesterday offered A$830 million ($848 million) for control of the Australian copper producer in a push to secure access to overseas resources.
Among shares that fell, LG Display (034220) slumped 4.5 percent to 26,850 won in Seoul. Korea Investments downgraded the shares to hold from buy, saying TV and notebook panel prices may start falling in the fourth quarter.
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