Asian Stocks Post Best Weekly Rally in Six Weeks on U.S.

Asian stocks rose, with the regional benchmark index posting its biggest weekly gain in six weeks, after U.S. jobless claims fell more than forecast.

Mazda Motor Corp., a Japanese carmaker that gets 30 percent of its revenue in North America, climbed 1.9 percent. Fraser & Neave Ltd. gained 2.7 percent in Singapore after the developer announced a cash distribution to shareholders. Takeda Pharmaceutical Co. slumped 5.2 percent in Tokyo after saying it ended development of a diabetes drug on safety concerns.

The MSCI Asia Pacific Index rose 0.5 percent to 140.48 after falling as much as 0.2 percent. The gauge climbed 1.3 percent this week, the most since the period ended Nov. 15. Japan’s Topix (TPX) index added 0.8 percent, closing at its highest since July 2008. U.S. shares extended a record as the Federal Reserve prepares to scale back quantitative easing starting January amid signs of recovery.

“Data, especially from the States, is supportive and the rally is continuing,” said Donald Williams, Sydney-based chief investment officer who help oversee about A$1.6 billion ($1.4 billion) at Platypus Asset Management Ltd. “The beginning of the withdrawal of QE is nearly upon us and the market has dealt with that pretty well.”

Japan’s Nikkei 225 Stock Average was little changed even as the yen reached 105 per dollar for the first time in five years. Data showed the nation’s consumer prices excluding food rose 1.2 percent in November from a year earlier, exceeding 1 percent for the first time since 2008. The central bank in April set a 2 percent inflation goal.

South Korea’s Kospi index added 0.2 percent. Australia’s S&P/ASX 200 Index fell 0.1 percent and New Zealand’s NZX 50 Index was little changed as the markets reopened from holidays. Singapore’s Straits Times Index rose 0.5 percent, and Taiwan’s Taiex Index gained 0.6 percent.

China Shares

The Hang Seng China Enterprises Index, also known as the H-share index, was little changed, while Hong Kong’s Hang Seng Index gained 0.3 percent. China’s Shanghai Composite Index advanced 1.4 percent after money-market rates posted the biggest weekly decline since February 2011. China data today showed industrial companies’ profits rose 9.7 percent from a year earlier in November, compared with a 15.1 percent jump in October.

Futures on the Standard & Poor’s 500 Index fell 0.2 percent today. The index gained 0.5 percent yesterday, extending an all-time high, as government data showed jobless claims declined by 42,000 to 338,000 last week. The median forecast of economists surveyed by Bloomberg called for a drop to 345,000.

U.S. Economy

Continuing claims rose, with the year-end holidays making it difficult to adjust for fluctuations in applications for jobless benefits, a Labor Department official said. The Federal Reserve on Dec. 18 said it will reduce monthly bond purchases to $75 billion from $85 billion amid faster-than-estimated economic growth and a five-year low in unemployment.

Companies that do business in the U.S. rose, with Mazda adding 1.9 percent to 542 yen. Yue Yuen Industrial (Holdings) Ltd., a shoemaker that gets about 29 percent of sales from the U.S., rose 1 percent to HK$25.35.

Fraser & Neave Ltd. gained 2.7 percent to S$6.37 after proposing a capital reduction that involves cash distribution of about $606.8 million to sharesholders.

Takeda Pharmaceutical slumped 5.2 percent to 4,835 yen after saying it terminated the development of TAK-875, a diabetes drug, after it was linked to liver damage.

Abe’s Controversy

Chinese carmakers fell after Japanese Prime Minister Shinzo Abe drew criticism from China and South Korea after he made a visit yesterday to the Yasukuni shrine in Tokyo honoring war criminals and others.

Guangzhou Automobile Group Co. lost 5.2 percent to HK$8.39. The company gets 80 percent of its sales volume and majority of its profit from joint ventures with Toyota and Honda Motor Co., according to Phillip Securities (HK) Ltd. Dongfeng Motor Group Co., which makes vehicles with Nissan Motor Co., dropped 4.4 percent to HK$12.12.

The Asia-Pacific gauge traded at 13.9 times estimated earnings, compared with 16.7 for the S&P 500, 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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