Asian Stocks Outside Japan Rise on U.S., China Funding

Asian stocks outside Japan gained after data showed the U.S. economic recovery gaining momentum and China’s central bank moved to ease a cash crunch.

Techtronic Industries Co., a power-tool maker that gets 73 percent of sales from North America, climbed 3.4 percent in Hong Kong after U.S. consumer spending rose. Agricultural Bank of China Ltd., the nation’s third-biggest lender, gained 1.3 percent. Japan’s Nikkei 225 Stock Average pared gains to 0.1 percent after touching 16,000 for the first time in six years. Mitsubishi Motors Corp. jumped 4.3 percent after the Japanese carmaker raised its operating-profit forecast.

The MSCI Asia Pacific Excluding Japan Index advanced 0.4 percent to 463.89. The broader MSCI Asia Pacific Index was little changed at 139.14.

“We are seeing the beginning of a self-sustaining recovery in the U.S. economy,” said Takashi Miyazaki, general manager of strategic research at Mitsubishi UFJ Asset Management Co., a unit of Japan’s biggest bank. “Markets will correct when they rise too fast in the short term, but they will extend gains down the road.”

Japan’s Topix (TPX) index fell 0.3 percent as Japan’s markets reopened from a holiday. The Cabinet Office released its December economic report today, dropping a reference to the term “deflation” for the first time since October 2009, saying “prices are holding firm.”

Regional Gauges

South Korea’s Kospi index advanced 0.2 percent. Australia’s S&P/ASX 200 Index rose 0.7 percent. New Zealand’s NZX 50 Index gained 1 percent. Singapore’s Straits Times Index rose 0.4 percent, and Taiwan’s Taiex Index lost 0.1 percent.

The Hang Seng China Enterprises Index (HSCEI), also known as the H-share index, added 1.8 percent, while Hong Kong’s Hang Seng Index gained 1.1 percent. China’s Shanghai Composite Index rose 0.2 percent.

China’s benchmark money-market rate tumbled the most since February 2011 after the central bank injected funds via open-market operations for the first time in three weeks, helping alleviate a year-end cash crunch. Agricultural Bank of China gained 1.3 percent to HK$3.79. Industrial & Commercial Bank of China Ltd., the nation’s largest lender, climbed 1.4 percent to HK$5.26.

Futures on the Standard & Poor’s 500 Index were little changed today. The measure rose 0.5 percent yesterday to a record on data showing that consumer spending the most in five months in November as Americans took advantage of discounts during the year-end shopping season. A separate report showed the Thomson Reuters/University of Michigan final index of consumer sentiment in December climbed to 82.5 from 75.1 a month earlier.

Techtronic rose 3.4 percent to HK$21.25. AAC Technologies Holdings Inc., a maker of acoustic components that gets 64 percent of its revenue in the U.S., gained 4.2 percent to HK$37.60.

U.S. Outlook

The International Monetary Fund is raising its outlook for the U.S. economy, as a budget deal in Washington and the Fed’s plan to taper its bond buying ease doubts about the future, IMF Managing Director Christine Lagarde said in an interview with NBC’s “Meet the Press” on Dec. 22, without giving a new projection. The IMF predicted in October that the world’s largest economy would expand 2.6 percent next year.

Mitsubishi Motors added 4.3 percent to 1,099 yen after raising its full-year net-income forecast 43 percent to 100 billion yen, citing a weaker yen, cost cuts and a review of corporate taxes.

Japan Tobacco Inc. dropped 2.2 percent to 3,290 yen after Sky News reported the resignation of Pierre De Labouchere, the head of the company’s international business.

The Asia-Pacific gauge traded at 13.8 times estimated earnings, compared with 16.6 for the S&P 500 and 15.2 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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