Asian stocks rose for the first time in five days after Premier Wen Jiabao’s call for investment lifted Chinese railways shares and phone companies. Gains were limited on concern a global slowdown will hit earnings at companies from Advantest Corp. to BHP Billiton Ltd.
China Railway Construction Corp. jumped 5.2 percent, while China Telecom Corp. gained 1.8 percent. BHP Billiton, the world’s top mining company, slipped 0.5 percent in Sydney after Citigroup Inc. said slowing growth in China will hurt demand for iron ore. Advantest, a maker of memory-chip testers, slumped 3.3 percent in Tokyo after a leading U.S. manufacturer of semiconductor equipment cut its sales forecast.
“Uncertainty about the outlook for global demand is weighing on the market,” said Naoki Fujiwara, chief fund manager at Shinkin Asset Management Co. in Tokyo, which oversees about $6.3 billion. “Stocks are becoming unattractive, with U.S. earnings that aren’t so great and with the ongoing Europe debt concern.”
The MSCI Asia Pacific Index added 0.2 percent to 116.88 as of 8:09 p.m. in Tokyo, with about five stocks falling for every four that rose. The measure has lost about 2 percent since July 4 as the U.S. unemployment rate failed to improve and China’s imports economy grew at about half the pace forecast by economists.
Stocks in Asia’s benchmark equities gauge are valued at 11.8 times estimated earnings on average, compared with 12.9 times for the Standard & Poor’s 500 Index and 10.7 times for the Stoxx Europe 600 Index.
Japan’s Nikkei 225 Stock Average dropped 0.1 percent as the yen rose to a five-week high against the euro before a Bank of Japan monetary policy decision tomorrow. Trading volume on Japan’s benchmark index was about 13 percent below the 30-day intraday average.
South Korea’s Kospi Index declined 0.2 percent.
Hong Kong’s Hang Seng Index added 0.1 percent, while the Shanghai Composite Index rose 0.5 percent after Wen’s comment signaled officials may boost spending to counter a slowdown that probably extended into a sixth quarter.
Australia’s S&P/ASX 200 Index was little changed, paring earlier losses, after a report showed confidence among the country’s consumers rose to a five-month high.
BHP declined 0.5 percent to A$31.05 in Sydney. Iron-ore prices may drop to $135 a ton in the third quarter as China buys less of the material, Citigroup commodity researcher Daniel Hynes said. Prices averaged $139 in the three months through June, according to The Steel Index Ltd.
Alumina Ltd., a maker of the material used to make aluminum, slumped 4.3 percent to 67.5 Australian cents after Morgan Stanley said the company won’t pay a dividend this year because of worsening margins.
Semiconductor-related stocks sank in Asia after U.S.-based Applied Materials Inc. cut its forecast for sales and profit amid weakening demand from Europe and China. The cut came a day after Advanced Micro Devices Inc., the second-biggest maker of processors for personal computers, reported an unexpected drop in sales.
Advantest slumped 3.3 percent to 1,100 yen in Tokyo. Renesas Electronics Corp., a Japanese maker of chips used in cars and appliances, plunged 7.9 percent to 291 yen.
SK Hynix Inc. dropped 3.2 percent to 22,950 won in Seoul, while Samsung Electronics Co. sank 0.8 percent to 1.118 million won. Taiwan Semiconductor Manufacturing Co. declined 1.3 percent to NT$78.10 in Taipei.
Chinese railway and phone companies advanced after Premier Wen, in a statement on the government’s website yesterday, called for private investment in the industries, along with spending on public utilities, healthcare and education. Promoting investment growth is the key now to stabilizing China’s economic expansion, he said.
China Railway Construction jumped 5.2 percent to HK$6.65. CSR Corp., a train builder, advanced 1.7 percent to HK$5.55.
China Telecom, the mainland’s biggest fixed-line carrier, rose 1.8 percent to HK$3.48. China Wireless Technologies Ltd. jumped 4.4 percent to HK$1.44.