Asian Stocks Rise on Japan-China Dispute Talks, U.S. Data

Asian stocks rose, with the regional benchmark index headed for its first gain this week, after U.S. jobless claims fell more than estimated and China and Japan agreed to hold talks over a territorial dispute that has disrupted trade between Asia’s biggest economies.

Toyota Motor Corp., a Japanese carmaker whose sales in China slumped last month after rioters torched dealerships in protests over disputed islands, added 1.1 percent. China Cosco Holdings Co. climbed 8 percent, leading Chinese shipping companies higher, after rates for hauling commodities rose. Softbank Corp. plunged 17 percent, dragging the Nikkei 225 Stock Average to a fourth day of declines, on talks to invest in loss-making Sprint Nextel Corp.

The MSCI Asia Pacific Index gained 0.4 percent to 120.77 as of 7:36 p.m. in Tokyo, with more than three shares rising for every two that fell. The measure is poised for a 1.5 percent slide this week, its biggest weekly drop since August, after the International Monetary Fund cut its global growth forecasts and Japanese car sales fell in China. The two countries have agreed to hold talks to reduce tensions.

“It will take a while to fully recover the pre-dispute situation, but at least we’re seeing some gradual improvement in the China-Japan relations,” said Yoji Takeda, who oversees about $1.2 billion as head of Asian equities at RBC Investment Management (Asia) Ltd. “As investors see more positive earnings reports, people may start to turn confident. We’re seeing moderate growth in the U.S. and the stock market there has held up quite well.”

Stimulus Measures

The MSCI Asia Pacific Index gained 5.7 percent this year through yesterday as central banks from Europe to the U.S. and Japan added stimulus measures to counter a global economic slowdown and the European debt crisis. The Asian benchmark traded at 12.7 times estimated earnings on average, compared with 13.7 times for the Standard & Poor’s 500 Index and 12 times for the Stoxx Europe 600 Index.

Singapore’s Straits Times Index climbed 0.4 percent, erasing losses of 0.2 percent. The country’s central bank unexpectedly refrained from easing monetary policy even as the economy contracted last quarter, saying inflation will remain elevated for some time.

Hong Kong’s Hang Seng Index advanced 0.7 percent. China’s Shanghai Composite Index and Australia’s S&P/ASX 200 Index added 0.1 percent. South Korea’s Kospi Index was little changed.

The BSE India Sensitive Index slid 0.7 percent as a cut in sales outlook for Infosys Ltd. outweighed a report showing the nation’s industrial production rebounded in August.

‘Sense of Crisis’

Japan’s Nikkei 225 Stock Average lost 0.2 percent, erasing gains of as much as 0.9 percent. Without the decline by Softbank and clothier Fast Retailing Co., which plunged 9.9 percent, the measure would have gained 1.4 percent today, according to data compiled by Bloomberg.

Japan’s Economy Minister Seiji Maehara said he has a “sense of crisis” as the government downgraded its economic assessment for a third month, the longest streak since the 2009 global recession.

Futures on the Standard & Poor’s 500 Index added 0.2 percent today after the index closed little changed in New York yesterday.

First-time applications for U.S. jobless benefits dropped 30,000 to 339,000 last week, the fewest since February 2008, government data showed yesterday. Economists forecast 370,000 claims, according to a Bloomberg survey. One state accounted for most of the drop, a Labor Department spokesman said.

Japanese carmakers advanced as Japan and China agreed to hold talks over a territorial dispute that has disrupted trade and resulted in a slump in China sales for Toyota, Nissan Motor Co. and Honda Motor Co. last month. No date has been set for the vice-ministerial level discussions, Japan’s foreign ministry said yesterday.

Shipping Stocks

Toyota, the world’s biggest carmaker by market value, increased 1.1 percent to 2,934 yen in Tokyo. Nissan rose 1.5 percent to 666 yen. Honda gained 0.8 percent to 2,338 yen.

China’s shipping companies advanced. Charter rates for cape-sized vessels have risen 50 percent from mid-September lows. Investor interest in the sector is returning because “stocks are so bombed out and rates have started to recover from lows,” Deutsche Bank AG analysts Joe Liew and Sky Hong wrote in a note yesterday.

China Cosco, the nation’s biggest shipping company, jumped 8 percent to HK$3.66. China Shipping Development Co. gained 5.8 percent to HK$3.48.

Chinese lenders advanced. Banks are limiting discounts for their best corporate clients to 10 percent of the benchmark lending rate, officials at the top four lenders said, asking not to be identified as they’re not authorized to speak publicly. The central bank in July began allowing lenders to offer credit at 30 percent less than the benchmark rates.

Banks Advance

Industrial & Commercial Bank of China Ltd., the world’s biggest lender by market value, rose 1.4 percent to HK$4.96. China Construction Bank Corp., the country’s No. 2 lender, gained 1.8 percent to HK$5.76.

Among stocks that fell, Billabong International Ltd. tumbled 17 percent to 83.5 Australian cents, a record low, after TPG International LLC withdrew a A$694 million ($713 million) bid for the surfwear maker.

Softbank plunged 17 percent to 2,395 yen, its biggest decline since January 1998, after Japan’s third-largest phone operator said it’s in talks to invest in Sprint Nextel. CLSA called the possible deal “a cause for concern,” citing difficulty returning the U.S. company to profit.

Fast Retailing sank 9.9 percent to 16,040 yen after forecasting annual profit below analyst estimates as a global economic slowdown hurt sales of its Uniqlo branded apparel.

Infosys Ltd. fell 5.4 percent to 2,395.35 rupees as India’s second-largest software services exporter cut its annual revenue forecast and said higher wages and currency fluctuations will hurt profitability.

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