Asian stocks rose, with the regional benchmark index extending its longest run of gains this year, as China trade data and comments by Federal Reserve Chairman Janet Yellen boosted optimism about the world’s biggest economies.
Camera-maker Canon Inc. (7751) rose 1.2 percent in Tokyo. Agricultural Bank of China Ltd. climbed 2.7 percent, pacing gains among the nation’s lenders listed in Hong Kong as data showed growth in mainland imports and exports last month exceeded estimates. Toyota Motor Corp. pared its advance to 0.4 percent after the world’s top carmaker said it will recall more than half of all Prius vehicles to update software.
The MSCI Asia Pacific Index added 1.2 percent to 136.62 as of 9:41 p.m. in Tokyo, rising a sixth day and climbing 5 percent from a five-month low on Feb. 4. U.S. economic growth has picked up and the Fed will continue to scale back stimulus in “measured steps,” Yellen said yesterday.
“Markets have been oversold recently as concerns about emerging markets were a bit overblown,” Nader Naeimi, the Sydney-based head of dynamic asset allocation at AMP Capital Investors, which manages $131 billion, said by phone. “Yellen sounded quite dovish, which is what investors wanted to hear. While things are improving, she acknowledged that the U.S. recovery is still not strong enough, suggesting monetary policy will remain easy.”
China’s overseas shipments surged 10.6 percent last month from a year earlier, a government report showed today, defying signs the world’s second-largest economy is losing momentum while fueling speculation that fake shipments are resurfacing. The increase compares with the 0.1 percent median growth estimate of 43 analysts in a Bloomberg survey. Imports rose 10 percent, according to the government data.
“If you take this particular piece of data, it obviously goes against the expectation of a slowdown,” said Tim Leung, a Hong Kong-based portfolio manager who helps oversee about $1.5 billion at IG Investment Ltd. “Valuations are low because investors had the general expectation that growth will continue to decelerate.”
Hong Kong’s Hang Seng Index (HSI), which last week dropped to the lowest valuation in more than a decade versus developed-nation shares, climbed 1.5 percent today. The Hang Seng China Enterprises Index of mainland companies in the city jumped 1.4 percent. China’s Shanghai Composite Index gained 0.3 percent.
Japan’s Topix index rose 1.3 percent as it reopened after a holiday. South Korea’s Kospi index gained 0.2 percent, and Taiwan’s Taiex increased 1 percent. Singapore’s Straits Times Index advanced 0.2 percent. India’s S&P BSE Sensex index increased 0.4 percent, and New Zealand’s NZX 50 Index added 0.4 percent. Australia’s S&P/ASX 200 Index jumped 1.1 percent.
Thailand’s SET Index advanced 1.4 percent. The nation’s Constitutional Court rejected a petition by the opposition Democratic Party to annul a Feb. 2 election. The results of the poll, which the main opposition Democrat Party boycotted, won’t be announced until April by-elections are held in dozens of districts where voting was disrupted by political protests.
The Asia-Pacific equity benchmark is rebounding after dropping 4.6 percent in January, its worst start since 2009, amid concern about the Fed’s stimulus cuts, a slowdown in China and volatility in developing markets. Global equity losses in 2014 peaked at $3 trillion on Feb. 4 and have since narrowed to less than $1 trillion, data compiled by Bloomberg show.
Futures on the Standard & Poor’s 500 Index slipped less than 0.1 percent today. The House of Representatives voted yesterday to suspend the U.S. debt limit until March 2015, a win for President Barack Obama and Democrats in Congress who insisted the ceiling be lifted without conditions.
“It’s good news that the U.S. debt ceiling debate is out of the way,” AMP’s Naeimi said.
The U.S. equity benchmark gained 1.1 percent yesterday, giving the measure its biggest four-day rally in more than a year, as Yellen delivered her first public remarks as head of the Fed.
“I am committed to achieving both parts of our dual mandate: helping the economy return to full employment and returning inflation to 2 percent while ensuring that it does not run persistently above or below that level,” she said.
The Federal Open Market Committee has twice reduced the size of the monthly asset-purchase program, cutting bond buying to $65 billion from $85 billion.
Shares on the MSCI Asia Pacific Index traded at 12.8 times estimated earnings 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.
Of the 302 companies on the Asian measure that have reported quarterly earnings since the beginning of January and for which estimates are available, 53 percent beat profit expectations, Bloomberg-compiled data show.
Exporters advanced. Canon climbed 1.2 percent to 3,046 yen in Tokyo. Honda Motor Co. (7267), which gets about 83 percent of sales outside Japan, jumped 3.3 percent to 3,834 yen. LG Electronics Inc., the world’s second-largest maker of televisions, rose 1.6 percent to 61,800 won in Seoul.
Chinese lenders increased in Hong Kong. Agricultural Bank of China climbed 2.7 percent to HK$3.49. China Construction Bank Corp. (939), the nation’s second-largest lender, rose 1.7 percent to HK$5.43. Industrial & Commercial Bank of China Ltd., the country’s biggest, added 1.5 percent to HK$4.82.
Sony Corp., the maker of Bravia televisions and PlayStation video-game consoles, jumped 3.7 percent to 1,765 yen. The Nikkei newspaper reported the company is in talks to supply more camera components for Apple Inc.’s new iPhone.
Sanrio Co. surged 9.7 percent to 4,225 yen in Tokyo, the biggest advance on the MSCI Asia Pacific Index. The toymaker said it will pay a special dividend of 10 yen per share to commemorate the 40th anniversary of Hello Kitty, bringing the full-year dividend to 80 yen from 70 yen.
Toyota gained 0.4 percent to 6,020 yen, after gaining as much as 0.7 percent earlier. The company is recalling about 1.9 million Prius vehicles globally, spokesman Brian Lyons said.
Among stocks that declined, CSL Ltd. fell 3 percent to A$67.75 in Sydney. Australia’s biggest pharmaceutical company reported first-half revenue that missed estimates and profit growth was crimped by charges related to a U.S. lawsuit.
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