Asian Stocks Rise to Five-Month High on U.S. Deal, China

Asian stocks rose for a second week, with the benchmark index climbing to a five-month high, after U.S. lawmakers reached an accord to reopen the government and avoid a default.

Samsung Electronics Co. (005930), a maker of smartphones and televisions that gets 43 percent of its sales in the Americas and China, advanced 2 percent. GungHo Online Entertainment Inc. soared 12 percent in Tokyo after the game developer and parent SoftBank Corp. agreed to buy Finland’s Supercell Oy. Sands China Ltd. (1928) reached a record high in Hong Kong after the Macau casino operator reported a surge in profit.

The MSCI Asia Pacific Index gained 1.8 percent to 143.45 this week, the highest close since May 21. Shares also gained after data yesterday showed China’s economic growth accelerated.

“You had this cloud over the debt ceiling being resolved, and this opens the door for a new leg in the equity market toward year-end,” said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which manages $131 billion. “Fundamentals are improving and you see solid numbers out of China and start seeing a turnaround in China’s growth.”

Japan’s Topix index added 0.7 percent this week, while South Korea’s Kospi Index gained 1.4 percent. New Zealand’s NZX 50 Index climbed 0.4 percent. Australia’s S&P/ASX 200 Index rose 1.7 percent after the nation’s central bank said it retains the option to loosen policy further to spur growth, according to minutes of the body’s Oct. 1 meeting.

Singapore’s Straits Times Index advanced 0.4 percent. Taiwan’s Taiex Index added 1.1 percent. Hong Kong’s Hang Seng Index (HSI) gained 0.5 percent, while China’s Shanghai Composite Index lost 1.5 percent.

Impasse Resolved

Asian shares gained this week after the U.S. Senate crafted a bipartisan deal to end the government shutdown and raise the debt limit. Lawmakers passed the bill by wide margins before it was signed into law by President Barack Obama.

BlackRock Inc. and Pacific Investment Management Co. say the Federal Reserve will postpone tapering as a result of the debt-ceiling stand-off. Policy makers in September said bond purchases this year will be cut from a record $85 billion a month. The central bank next meets Oct. 29-30.

Companies that do business in the U.S. advanced. Samsung added 2 percent to 1.47 million won. James Hardie Industries SE, an Australian maker of building materials that gets about 70 percent of sales from the U.S., rose 2.5 to A$10.76. Nissan Motor Co. (7201), a Japanese carmaker that gets about 34 percent of its car sales from North America, gained 1.8 percent to 1,027 yen.

China Growth

China’s gross domestic product rose 7.8 percent from a year earlier in the July-September period, the National Bureau of Statistics said yesterday in Beijing, matching the median estimate in a Bloomberg News survey. Industrial production advanced in September by 10.2 percent, in line with projections, while retail sales gained 13.3 percent.

GungHo Online Entertainment jumped 12 percent to 81,100 yen after parent SoftBank said they will buy a 51 percent stake in gamemaker Supercell for $1.53 billion. SoftBank rose 0.7 percent to 7,280 yen.

Sands China soared 13 percent to a record HK$58 as earnings surged after its new resort in Macau drew more gamblers. Third-quarter net income for the casino operator rose 89 percent to $617.9 million from a year earlier, according to parent Las Vegas Sands Corp.’s filing.

Boral, Kansai

Boral Ltd. advanced 4.2 percent to A$4.94 after USG Corp. agreed to pay the Australian company as much as $575 million to create a jointly owned building-materials business spanning Asia and the Middle East.

Kansai Electric Power Co. added 4 percent to 1,341 yen. The Japanese utility reported an unexpected first-half profit and its equity rating was raised to overweight at JPMorgan Chase & Co.

Among stocks that fell, SBI Holdings Inc. lost 3.8 percent to 1,241 yen. The Japanese brokerage announced it plans to sell 30 billion yen ($306 million) in convertible bonds.

The MSCI Asia Pacific Index traded at 13.8 times average estimated earnings yesterday, compared with multiples of 15.8 for the Standard & Poor’s (SPX) 500 Index and 14.6 for the STOXX Europe 600 Index, according to data compiled by Bloomberg.

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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