Japanese, Australia Stock Futures Rise Amid Stimulus Optimism

Japanese and Australian stock futures rose as optimism grew that stimulus by central banks will boost earnings and as investors await Chinese trade data.

American Depositary Receipts of Canon Inc. (7751), a camera maker that gets 80 percent of sales outside Japan, climbed 0.6 percent. Those of Coca-Cola Amatil Ltd. (CCL) rose 1.2 percent, indicating the shares will rebound from the biggest slump in four years, as JPMorgan Chase & Co. advised buying stock in Australia’s largest listed drinks company. ADRs of Toyota Motor Corp. slid 0.3 percent before the world’s biggest carmaker reports earnings.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring in June traded at 14,230 in Chicago yesterday, up from 14,160 at the close in Osaka, Japan. They were bid in the pre-market at 14,220 in Osaka at 8:05 a.m. local time. Futures on Australia’s S&P/ASX 200 Index advanced 0.5 percent and New Zealand’s NZX 50 Index was little changed, trading near a record high.

“Markets are being driven by heightened stimulus,” said Matthew Sherwood, Sydney-based head of investment market research at Perpetual Ltd., which manages about $25 billion. “Economic data remains in the Goldilocks range -- weak enough to warrant continued stimulus, but strong enough to keep earnings expectations positive.”

Interest Rates

Reserve Bank of Australia Governor Glenn Stevens and his board yesterday cut the benchmark interest rate to a record-low 2.75 percent. European Central Bank President Mario Draghi said May 6 that policy makers are ready to cut borrowing costs again if needed after reducing them to the lowest ever last week.

Futures on Hong Kong’s Hang Seng Index gained 0.9 percent and contracts on the Hang Seng China Enterprises Index of mainland companies trading in Hong Kong added 0.7 percent.

Data today is forecast to show China’s exports grew 9.2 percent in April, slowing from 10 percent in March. Imports probably rose 13 percent compared with 14.1 percent a month earlier, according to a Bloomberg survey of economists. A report due May 9 may show consumer prices gained 2.3 percent in April from a year earlier, below a government assumption for 2013 of 3.5 percent, according to the median estimate of economists.

The MSCI Asia Pacific Index, the benchmark regional equities gauge, climbed 9.8 percent this year through yesterday amid optimism the Bank of Japan will deploy more measures to beat deflation and policy makers in the U.S. and Europe remain on standby to buoy growth.

Relative Value

That left the gauge yesterday trading at 14.3 times average estimated earnings compared with 14.7 for the Standard & Poor’s 500 Index (SPX) and 13.2 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Japan’s Nikkei 225 Stock Average yesterday climbed 3.6 percent, trading above 14,000 for the first time since June 2008. The broader Topix Index jumped 3.1 percent to a level not seen since before Lehman Brothers Holdings Inc. filed for bankruptcy protection on Sept. 15, 2008.

Futures on the Standard & Poor’s 500 Index fell 0.1 percent. The gauge yesterday added 0.5 percent to 1,625.96, its fourth record close.

The Bloomberg China-US Equity Index of the most-traded Chinese shares in the U.S. climbed 1 percent in New York yesterday.

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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