Asia Stocks Outside Japan Rise as Market Weighs Shutdown

Photographer: Yuriko Nakao/Bloomberg

A man walks past an electronic monitor displaying graphs of various market indices outside a securities firm in Tokyo. Japan’s Topix index gained 0.4 percent after Prime Minister Shinzo Abe unveiled a 5 trillion yen ($51 billion) stimulus package to cushion the first sales-tax increase since 1997. Close

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Photographer: Yuriko Nakao/Bloomberg

A man walks past an electronic monitor displaying graphs of various market indices outside a securities firm in Tokyo. Japan’s Topix index gained 0.4 percent after Prime Minister Shinzo Abe unveiled a 5 trillion yen ($51 billion) stimulus package to cushion the first sales-tax increase since 1997.

Asian stocks outside Japan rose as investors speculated economic effects would be limited from the first partial U.S. government shutdown in 17 years.

Samsung Electronics Co. gained 2.6 percent in Seoul after the consumer-electronics maker said third-quarter earnings will improve at its mobile unit. Paladin Energy Ltd. soared 10 percent in Sydney as the uranium explorer announced cost cuts. Hutchison Whampoa, controlled by Li Ka-shing, surged the most since November 2007 on a report it may seek to raise $10 billion spinning off its Watsons retail arm. Nissan Motor Co., a carmaker that gets about 80 percent of its revenue outside Japan, dropped 1 percent as the yen gained.

The MSCI Asia Pacific excluding Japan Index rose 0.2 percent to 461.86 as of 5:08 p.m. in Tokyo, while the broader gauge slipped 0.2 percent to 138.49. The U.S. government is in partial shutdown after lawmakers failed to agree on a federal budget. Congress also faces a dispute over raising the $16.7 trillion debt limit this month.

“People see this is a short-term impact, but the key question is around the debt ceiling and that’s what people are looking forward to,” said Chris Weston, chief market strategist at IG Markets Ltd. in Melbourne. “If you take away the U.S. fiscal position, then equity appreciation is still very strong.”

Japan’s Topix (TPX) index fell 1.5 percent. Prime Minister Shinzo Abe yesterday after the close unveiled a 5 trillion yen ($51 billion) stimulus package to cushion the first sales-tax increase since 1997.

Regional Gauges

Japanese exporters dropped as the yen extended yesterday’s advance against the dollar, weighing on offshore earnings. Nissan slid 1 percent to 982 yen. Komatsu Ltd., a maker of construction equipment that gets about 30 percent of its revenue in the Americas, lost 2 percent to 2,359 yen.

Australia’s S&P/ASX 200 Index (AS51) rose 0.2 percent, while New Zealand’s NZX 50 Index added 0.5 percent. South Korea’s Kospi index was little changed. Hong Kong’s Hang Seng Index jumped 0.6 percent after reopening from a holiday. Markets are closed in China for National Day celebrations until Oct. 8. Singapore’s Straits Times Index fell 0.7 percent, and Taiwan’s Taiex index advanced 0.4 percent.

Futures on the Standard & Poor’s 500 Index fell 0.7 percent today after the measure gained 0.8 percent yesterday. The U.S. government began a shutdown yesterday as Republicans and Democrats remained at odds over whether to tie any changes to the 2010 Affordable Care Act to a short-term extension of government funding. As many as 800,000 federal employees were out of work, while some services were halted.

Shutdown Costs

Closing down parts of the government will cost the U.S. at least $300 million a day in lost economic output at the start, according to IHS Inc., with the impact increasing if a prolonged impasse dents consumer and business confidence.

The MSCI Asia Pacific Index rose 6.4 percent in September, the biggest monthly advance since January 2012. The measure traded at 13.5 times estimated earnings as of yesterday, compared with 15.4 for the S&P 500 and 14.2 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Samsung Electronics gained 2.6 percent to 1,418,000 won in Seoul after the Korea Economic Daily reported the company’s telecommunication business earnings will be better than in the second quarter, citing JK Shin, head of mobile business. Samsung spokeswoman Chenny Kim confirmed Shin’s comments.

Paladin surged 10 percent to 53 Australian cents after reporting cost cuts including a 10 percent reduction in board and management base salaries.

Hutchison Whampoa increased 3.3 percent to HK$95.95. The company may list Watsons on the Hong Kong’s exchange within the next 12 to 18 months, according to a Hong Kong Economic Times report citing unidentified people.

Among other stocks that rose, SoftBank Corp. advanced 4 percent to 7,240 yen after Goldman Sachs Group Inc. said new iPhone sales at competitor NTT DoCoMo Inc. may be more affected by inventory shortages than at other Japanese carriers.

To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net

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