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Asian Stocks Post Weekly Rise, Led by China Shares, on U.S. Data

Asian stocks rose this week, led by Hong Kong-listed Chinese companies, as reports on U.S. employment, manufacturing and consumer confidence added to signs the world’s largest economy is recovering.

The Hang Seng China Enterprises Index gained 3.7 percent for the week, capping a more than 20 percent gain since a September low and entering a bull market after China’s manufacturing expanded for the first time in three months. China Petrochemical & Chemical Corp., the nation’s biggest refiner, increased 5.7 percent in Hong Kong. BHP Billiton Ltd., the world’s largest mining company, climbed 1.7 percent.

The MSCI Asia Pacific Index (MXAP) gained 0.8 percent to 122.56 this week, erasing a 0.4 percent loss in October. Raw-material shares and information-technology companies gained the most this week among the 10 industries tracked on the gauge.

“Global indicators are starting to show an improvement in momentum, particularly in the U.S.,” said Nader Naeimi, Sydney- based head of dynamic asset allocation at AMP Capital Investors Ltd., which manages almost $100 billion. “This can be sustained if central banks keep supporting growth.”

The regional benchmark has gained 7.7 percent this year as central banks in Europe, the U.S., Japan and China added stimulus measures to counter a global economic slowdown and the European debt crisis. The index traded at about 13.4 times estimated earnings on average, compared with 13.7 for the Standard & Poor’s 500 Index and 12.3 for the Stoxx Europe 600 Index.

Hong Kong Gains

The Hang Seng China Enterprises Index (HSCEI) gained more than 20 percent from a Sept. 5 low. Building-material and railway companies have led the advance as China increased investment in fixed assets. China National Building Material Co. has gained 47 percent during the period, while Anhui Conch Cement Co. increased 44 percent. China Railway Group Ltd. is up 40 percent.

Hong Kong’s Hang Seng Index gained 2.6 percent to 22,111.33, its highest level since August 2, 2011. China’s Shanghai Composite Index advanced 2.5 percent.

Shares have risen on speculation China’s economy may be stabilizing. This week, a purchasing managers index indicated the manufacturing industry grew for the first time in three months in October. China’s central bank cut interest rates in June and July for the first time since 2008 and reduced banks’ reserve requirements three times since November to boost the economy.

Sinopec gained 5.7 percent to HK$8.48. Hengdeli Holdings Ltd. (3389), the Chinese retail partner of Swatch Group AG, gained 19 percent to HK$2.86 as Chinese tourists spent more money in Hong Kong shops. China Resources Land Ltd., a state-controlled developer, rose 9.8 percent to HK$18.60 this week.

Japan Rallies

Japan’s Nikkei 225 Stock Average rose 1.3 percent to 9,051.22, its highest level in six weeks, on higher-than-average trading volume as the yen weakened. South Korea’s Kospi Index (KOSPI) gained 1.4 percent to 1.918.72, the biggest weekly increase since September 14.

Among indexes that declined, Australia’s S&P/ASX 200 Index slid 0.3 percent to 4,460.1, falling for a second week, after a Nov. 1 report showed the nation’s manufacturing output contracted for an eighth month. Singapore’s Straits Times Index lost 0.5 percent to 3,042.7.

American companies expanded payrolls in October by the most in eight months, the Institute for Supply Management’s U.S. factory index topped estimates, and a measure of consumer sentiment rose to the highest since February 2008, reports showed Nov. 1.

U.S. Data

Reports on employment and manufacturing both exceeded estimates while a consumer confidence figure showed improvement in the outlook of U.S. shoppers.

BHP rose 1.7 percent to A$34.42 in Australia. Li & Fung, the world’s largest supplier of clothes and toys to retailers, rose 4.8 percent to HK$13.18 in Hong Kong. LG Display Co., an Apple Inc. supplier and the world’s second-largest maker of liquid-crystal displays, rose 14 percent to 34,350 Korean won.

Among companies on the MSCI Asia Pacific Index that reported quarterly earnings this week, 57 percent missed profit estimates, according to data compiled by Bloomberg.

Industrial & Commercial Bank of China Ltd., the world’s largest bank by market value, gained 3.1 percent to HK$5.25 after it posted earnings that beat analyst estimates.

Among stocks that fell, Panasonic Corp. (6752), Japan’s No. 2 TV maker, fell 17 percent to 411 yen, the lowest level since Feb. 18, 1975. The company had its credit rating downgraded two levels by Standard & Poor’s after it forecast a loss 30 times bigger than analyst estimates because of restructuring costs and falling demand.

To contact the reporter on this story: Eleni Himaras in Hong Kong at ehimaras@bloomberg.net

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

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