Japanese Stock Futures Little Changed Amid U.S. Budget Talks

Japanese stock futures were little changed ahead of a Federal Reserve policy meeting and as investors await progress on U.S. budget talks. Australian equities rose.

American Depositary Receipts of Mizuho Financial Group Inc. (8411) gained 0.1 percent as UBS AG advised buying the shares in Japan’s third-biggest banking group by market value. Hagihara Industries Inc. shares may be active in Tokyo after the textile maker reported an increase in full-year profit. BHP Billiton Ltd., the world’s largest mining company, climbed 1.1 percent in Sydney as metals prices increased.

Futures on Japan’s Nikkei 225 Stock Average expiring this month closed at 9,535 in Chicago yesterday, down from 9,540 in Osaka, Japan. They were bid in the pre-market at 9,520 in Osaka at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index gained 0.3 percent and New Zealand’s NZX 50 Index fell 0.1 percent in Wellington.

“The market now seems stuck in a trading range until news from Washington about any progress or deterioration in budget negotiations is released,” said Matthew Sherwood, head of markets research at Perpetual Investment, which manages about $25 billion in Sydney.

Japan’s Nikkei 225 has advanced 10 percent since Nov. 14, when Prime Minister Yoshihiko Noda called an election for Dec. 16, causing the yen to drop on expectations the opposition Liberal Democratic Party will win power and push for more monetary easing.

Fed Meeting

Futures on the Standard & Poor’s 500 Index fell 0.3 percent today. The S&P 500 gained less than 0.1 percent yesterday as economic data in China beat estimates and investors weighed prospects for a U.S. budget deal.

Federal Reserve policy makers begin a two-day meeting today that will be followed by updated projections on economic growth, unemployment, inflation and interest rates on Dec. 12. Fed officials are considering whether to supplement a $40 billion a month of mortgage-bond purchases with Treasury purchases when their Operation Twist program expires at the end of the month.

U.S. lawmakers need to agree on a budget to prevent more than $600 billion of automatic tax increases and spending cuts from coming into effect next year. President Barack Obama and Republican House Speaker John Boehner met one-on-one at the weekend at the White House. Representatives for the two said in statements afterward that “the lines of communication remain open.”

The MSCI Asia Pacific (MXAP) Index advanced 16 percent from this year’s low on June 4 through yesterday as central banks from Europe, the U.S., Japan and China took steps to support economic growth. The gauge traded at 14.2 times estimated earnings on average, compared with 13.7 times for the S&P 500 Index and 12.6 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S. gained 0.5 percent yesterday in New York.

The London Metal Exchange Index of six primary metals climbed 1.9 percent.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

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

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