Asian Stocks Rise Second Day as China Ends Meeting

Asian stocks rose for a second day, their first back-to-back gains in three weeks, as investors weighed earnings and a Chinese pledge to boost the role of the markets in economic development.

KDDI Corp. jumped to the highest in 13 years after Japan’s second-largest wireless carrier briefed investors on its earnings outlook. Incitec Pivot Ltd., an Australian fertilizer maker, surged 7.3 percent after announcing cost cuts. GCL-Poly Energy Holdings Ltd., the world’s top producer of polysilicon used in solar panels, gained 2.9 percent in Hong Kong after third-quarter sales jumped more than 500 percent.

The MSCI Asia Pacific Index added 0.4 percent to 139.72 as of 9:39 p.m. in Tokyo, with all but one of the 10 industry groups on the measure gaining. Japan’s Topix index advanced 1.7 percent as the yen fell. The MSCI Asia Pacific excluding Japan Index lost 0.2 percent.

“The changes that will come out of the secret location in Beijing are expected to be some of the most liberal economic changes in post-revolution China,” Evan Lucas, Melbourne-based market strategist at IG Ltd., said in a note today. “Three decades of economic and social policy is expected to be swept aside in the coming 48 hours.”

China’s top policy makers affirmed that markets must play a decisive role in the allocation of economic resources, as the central committee of the Communist Party of China concluded its first plenary session under the presidency of Xi Jinping, the official Xinhua News Agency reported.

Profound Changes

Chinese Politburo member Yu Zhengsheng said last month reforms to be discussed at the meeting of the party’s Central Committee will be unprecedented “and will promote profound changes in every area of the economy and society.” Yu is ranked fourth in the seven-strong Politburo Standing Committee headed by party chief and President Xi Jinping.

The Asia-Pacific gauge trades within 3.3 percent from this year’s high reached in May on speculation the U.S. Federal Reserve will maintain record stimulus for longer and as China’s economy showed signs of growth. The measure traded at 13.6 times estimated earnings as of yesterday, compared with multiples of 16 for the Standard & Poor’s 500 Index and 15 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

The Jakarta Composite Index dropped 1.4 percent to a five-week low after Indonesia’s central bank unexpectedly raised its benchmark interest rate in a bid to narrow a current-account deficit that has weighed on the rupiah.

Australia’s S&P/ASX 200 Index added 0.1 percent, while New Zealand’s NZX 50 Index lost 0.1 percent. South Korea’s Kospi index rose 0.9 percent. Futures on the S&P 500 fell 0.1 percent.

Hong Kong, Taiwan

Hong Kong’s Hang Seng Index (HSI) fell 0.7 percent, and China’s Shanghai Composite Index rose 0.8 percent. Taiwan’s Taiex Index gained 0.2 percent. Singapore’s Straits Times Index slipped 0.2 percent.

KDDI soared 5.1 percent to 5,970 yen, the highest since May 2000. The company expects operating earnings to rise more than 10 percent next fiscal year and for average revenue per user, a key measure of customer spending, to increase this fiscal year after a period of decline, a spokesman for KDDI said by phone.

Incitec Pivot surged 7.3 percent to A$2.80 after saying it will restructure its business to achieve A$20 million ($19 million) of annual cost savings. That was the biggest advance since October 2011.

GCL-Poly Energy rose 2.9 percent to HK$2.45 after third-quarter polysilicon sales jumped 512 percent from a year earlier while production increased 78 percent for the period.

Dentsu Rises

Dentsu Inc. (4324) added 5.4 percent to 3,915 yen. The Japanese advertising agency increased its net-income forecast for this year by 73 percent to 33.1 billion yen ($332 million), compared with the average estimate of 21.9b yen by 11 analysts surveyed by Bloomberg.

SJM Holdings Ltd. fell 5.5 percent to HK$24 as Asia’s biggest casino company by revenue posted third-quarter earnings that missed analyst estimates on rising competition in Macau.

Taiyo Yuden Co. slumped 11 percent to 1,134 yen, the biggest decline since March 2011. The component maker trimmed its net-income forecast to 9 billion yen yesterday, disappointing analysts expecting 11 billion yen, according to a Bloomberg survey.

Of the companies on the MSCI Asia Pacific Index that have reported quarterly earnings this season and for which Bloomberg compiles estimates, a little more than 50 percent exceeded analysts’ profit expectations.

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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