Asian stocks advanced, with the regional benchmark ending the week near its highest since June 2008, as the yen’s slide past 100 against the dollar buoyed exporters in the busiest week of Japan’s earnings season.
Toyota Motor Corp. (7203) jumped 10 percent after forecasting its highest profit in six years. Sharp Corp. surged 33 percent amid reports the unprofitable electronics maker will cut jobs and secure more investment from Samsung Electronics Co. HSBC Holdings Plc (5) rose 3.3 percent in Hong Kong after the lender posted a bigger-than-estimated increase in first-quarter profit.
The MSCI Asia Pacific Index added 1.3 percent to 141.86. The gauge retreated the past two days from the highest since June 2008. It’s risen 9.7 percent this year as the Bank of Japan started unprecedented monetary easing and policy makers in the U.S. showed willingness to add stimulus.
“The shift of money into equities is going to be an ongoing theme for a very long time,” said Peter Esho, Sydney-based investment adviser at Wilson HTM Investment Group, which manages $11.8 billion. “Central bank money-printing is not changing any time soon. It makes equity markets look very attractive.”
The MSCI Asia Pacific Index trades at 14.2 times estimated earnings, compared with multiples of 14.7 for the Standard and Poor’s 500 Index and 13.2 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Japan’s Topix Index increased 5 percent this week, erasing losses from the 2008 collapse of Lehman Brothers Holdings Inc. and ending the week at its highest level since September 2008. The exporter-heavy Nikkei 225 Stock Average climbed 6.7 percent, the biggest weekly gain since December 2009.
South Korea’s Kospi Index dropped 1.1 percent even after the Bank of Korea cut interest rates. Samsung and Hyundai Motor Co. each fell at least 3.8 percent as the won climbed to its highest level against the yen in more than four years.
The Shanghai Composite Index advanced 1.9 percent as China’s exports unexpectedly accelerated. Hong Kong’s Hang Seng Index added 2.8 percent, gaining for a third week. Taiwan’s Taiex Index climbed 1.8 percent.
HSBC advanced 3.3 percent to HK$88.05 this week in Hong Kong, gaining for a third week. The London-based lender’s first-quarter pretax profit increased to $8.43 billion from $4.32 billion a year earlier, beating the $8 billion average estimate of nine analysts surveyed by Bloomberg. The bank cited a reduction in bad loan provisions for the results.
Toyota, which gets about 75 percent of its revenue outside Japan, advanced 10 percent to 6,050 yen in Tokyo. The automaker forecast a 42 percent gain in net income this fiscal year on rising sales and a weaker yen.
Nikon Corp., which makes 85 percent of sales overseas, soared 18 percent to 2,500 yen after the camera maker forecast earnings that topped estimates.
The yen declined about 2 percent against the dollar this week to its lowest level since April 2009, extending its slide to about 5 percent since April 4 when BOJ Governor Haruhiko Kuroda pledged to double the monetary base to achieve a 2 percent inflation target.
“The yen weakened beyond a psychological threshold and may fall further,” said Takahiro Nakano, a Tokyo-based strategist at Mizuho Trust & Banking Co., a unit of Japan’s third-largest bank by market value. “Exporters are showing strong results, supporting the market. Also, companies may raise profit forecasts because many of them have conservative estimates.”
Of the 325 companies on the Asia-Pacific gauge that have reported quarterly earnings since the beginning of April and for which Bloomberg has estimates, 51 percent beat projections, Bloomberg data show.
News Corp. Profit
In Sydney, News Corp. leapt 6.6 percent to A$33 after the media company led by Rupert Murdoch tripled net income to $2.85 billion in its third quarter. Profit excluding some items was 36 cents a share, beating the 35 cent average of analyst estimates compiled by Bloomberg.
Among stocks that fell, Yue Yuen Industrial Holdings Ltd., which supplies Nike Inc., tumbled 14 percent to HK$23.20, the biggest weekly decline since November 2008. The shoemaker said first-quarter results demonstrated a significant downturn, and interim results may also be affected by rising costs and the relocation of a factory.
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