Asian stocks rose, with the regional benchmark index paring the biggest monthly decline in a year, amid speculation European officials will pledge more financial aid to Greece.
Cosco Pacific Ltd., the Hong Kong-based operator of container facilities in Greece, climbed 3.8 percent. Sony Corp., the maker of PlayStation gaming consoles that counts Europe as its biggest market outside of Japan, gained 1.9 percent in Tokyo. Hyundai Heavy Industries Co., the world’s biggest shipbuilder, surged 11 percent in Seoul after winning an order for two liquefied natural gas tankers.
The MSCI Asia Pacific Index gained 1.4 percent to 136.11 as of 7:24 p.m. in Tokyo, the highest close since May 13. More than six stocks advanced for each that fell in the gauge, which last week completed its longest string of weekly losses in two years as concern deepened over Europe’s debt crisis and amid speculation a slowing global recovery will crimp earnings.
“Talk of additional aid for Greece has given investors some relief for now,” said Andrew Pease, Sydney-based senior investment strategist for the Asia-Pacific region at Russell Investment Group. “These are just temporary solutions. That’s not a sustainable solution. Asian markets, particularly China, look genuinely cheap.”
Japan’s Nikkei 225 Stock Average climbed 2 percent, the steepest gain since March 30. Stocks extended gains today after a report showed Japan’s industrial production, disrupted by the March disaster, may rebound to near pre-earthquake levels by next month. The data also showed output grew less than economists expected last month.
India Economic Growth
“On the level of individual firms we’ve had a lot of anecdotal evidence that supply chains were recovering, but today’s figures are significant because they confirm that production is coming back,” said Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co., which oversees the equivalent of $104 billion.
India’s Sensitive Index advanced 1.5 percent. The nation’s economic growth eased to 7.8 percent in the three months to March 31 as manufacturing and services moderated, a slowdown that has yet to curb pressure for more increases in interest rates to damp inflation.
South Korea’s Kospi Index advanced 2.3 percent. Australia’s S&P/ASX 20 Index gained 0.9 percent. Hong Kong’s Hang Seng Index increased 2.2 percent, while China’s Shanghai Composite Index added 1.4 percent, its first increase in nine days.
European Union leaders will decide on additional aid for Greece by the end of June and have ruled out a “total restructuring” of the nation’s debt, said Jean-Claude Juncker, head of the euro-area finance ministers’ group. Greek Prime Minister George Papandreou said on May 27 he’ll press ahead with new austerity measures after failing to win backing from the main opposition parties.
‘Relief to Exporters’
Cosco Pacific advanced 3.8 percent to HK$15.42 in Hong Kong. Samsung Electronics Co., the world’s largest maker of televisions that gets one-fifth of its sales from Europe, climbed 2 percent to 902,000 won in Seoul. Sony, Japan’s biggest exporter of consumer electronics, rose 1.9 percent to 2,163 yen in Tokyo.
Japanese exporters also advanced as the euro rose against the yen, boosting the value of repatriated sales from Europe. Toyota Motor Co., the world’s biggest carmaker, gained 2.1 percent to 3,400 yen. Mazda Motor Corp., the Japanese carmaker most dependent on European sales, jumped 1.5 percent to 205 yen. Canon Inc., the camera maker whose largest source of revenue is Europe, advanced 2.1 percent to 3,905 yen.
“Even though the euro has weakened in the midst of Greece’s debt crisis, the currency is having a little comeback and that’s given some relief to exporter shares,” said Daiwa’s Nagano.
The MSCI Asia Pacific Index lost 2.5 percent this year through yesterday, compared with gains of 5.8 percent by the S&P 500 and 1.1 percent by the Stoxx Europe 600 Index. Stocks in the Asian benchmark were valued at 13.4 times estimated earnings on average, the same as for the S&P 500, and compared with 11.1 times for the Stoxx 600.
Hyundai Heavy surged 11 percent to 505,000 won in Seoul, the biggest advance on the MSCI Asia Pacific Index. The company won an order for two liquefied natural gas tankers from Dynagas Ltd. of Greece.
Hyundai Engineering & Construction Co., a South Korean builder, increased 2.1 percent to 84,000 won. The company said it received orders worth $230 million from Singapore and Iraq.
Hanwha Chemical Corp., South Korea’s fourth-largest maker of plastic resins by sales, jumped 9.6 percent to 48,950 won after Samsung Securities raised its share-price forecast to 59,500 won from 41,000 won and maintained its “buy” rating.
“While stock valuations are looking attractive, we’re still cautious as global growth is slowing,” said Diane Lin, a Sydney-based fund manager at Pengana Capital Ltd., which has about $1 billion of assets. “Europe’s situation is still very difficult.”
Futures on the Standard & Poor’s 500 Index rose 1 percent today. U.S. markets were closed yesterday for a public holiday.
U.S. economic data to be released this week are expected to show further evidence that growth in the world’s biggest economy is slowing. Nonfarm payrolls are expected to rise by 185,000 workers in May, less than the 244,000 increase in April, according to the median forecast in a Bloomberg News survey before Labor Department figures to be released on June 3. Another report may show factory orders grew at the slowest pace in seven months.
Renewable-energy companies rallied after German Chancellor Angela Merkel’s coalition endorsed yesterday a plan to close all of Germany’s atomic-power plants by 2022. The country will double energy output from renewable sources by 2020, Merkel said yesterday at a press conference in Berlin.
Taewoong Co., a South Korean maker of parts for wind power plants, surged 8.3 percent to 44,400 won in Seoul. OCI Co., the nation’s biggest maker of polysilicon that’s used in solar panels, jumped 9 percent to 493,000 won. GCL-Poly Energy Holdings Ltd., China’s largest maker of the same material, climbed 5.3 percent to HK$4.17 in Hong Kong.