Asian Stocks Rise, Led by Japan’s Exporters, as Yen Falls

Asian Stocks Advance Led by Japanese Exporters as Yen Weakens
Pedestrians walk past a branch of Bank of Tokyo Mitsubishi UFJ Ltd. in Tokyo, Japan. Photographer: Kiyoshi Ota/Bloomberg

Asian stocks rose, with the regional benchmark index extending its longest rally in more than three years, as Japanese exporters advanced after the yen touched an almost nine-month low versus the dollar.

Canon Inc., the world’s biggest camera maker, climbed 2.1 percent in Tokyo as the yen boosted exporters. Mitsubishi UFJ Financial Group Inc. rose 1.1 percent as Japan’s No. 1 lender is poised to announce the purchase of Bank of America Corp.’s stake in their banking venture. Chimei Innolux Corp., Taiwan’s largest maker of liquid-crystal displays, jumped 6.9 percent on a report it will return to profit next year as sales increase.

The MSCI Asia Pacific Index gained 0.3 percent to 127.37 as of 7:35 p.m. Tokyo time, poised to advance for an 11th day, the longest winning streak since July 2009. The measure rose 11 percent this year through yesterday as central banks took steps to support economic growth and Japanese shares rallied ahead of an election next week that polls suggest opposition leader Shinzo Abe will win.

“The overall environment is quite supportive for Asian equities,” said Grace Tam, Hong Kong-based global market strategist at JPMorgan Asset Management Ltd., which oversees about $1.3 trillion globally. “We expect to see more inflows coming towards the region, particularly from the Western foreign investors. Investors have a high expectation that if Abe wins the elections, they’ll do more aggressive monetary easing and people expect the yen to weaken.”

Samsung Surges

The Federal Reserve said yesterday it will expand asset purchases and central bank officials forecast it will maintain near zero interest rates until 2015.

South Korea’s Kospi Index climbed 1.4 percent to close at the highest since since Sept. 24. The nation’s central bank held borrowing costs unchanged before next week’s presidential elections. Samsung Electronics Co., the country’s first company to surpass $200 billion in market value, surged 2.9 percent to a record 1.533 million won.

Japan’s Nikkei 225 Stock Average increased 1.7 percent to the highest in eight months. Taiwan’s Taiex Index added 0.9 percent. Australia’s S&P/ASX 200 Index was little changed. Hong Kong’s Hang Seng Index fell 0.3 percent, while China’s Shanghai Composite Index dropped 1 percent.

Futures on the Standard & Poor’s 500 Index slipped 0.2 percent today. The gauge gained less than 0.1 percent yesterday as optimism about Federal Reserve plans to buy more bonds faded, with investor focus returning to the budget deadlock in Washington.

The Fed for the first time linked the outlook for its main interest rate to unemployment and inflation and said it will expand its asset purchase program by buying $45 billion a month of Treasury securities starting in January to spur the economy.

‘Serious Differences’

Republicans in Congress hardened their resistance to President Barack Obama’s proposed higher taxes for top earners and demanded a spending-cut plan. Lawmakers in both parties said it’s becoming less likely an agreement can be reached before the Christmas holiday. “We’ve got some serious differences,” House Speaker John Boehner told reporters yesterday in Washington.

A budget agreement will help avert the so-called fiscal cliff, which would result in more than $600 billion of spending cuts and tax increases. The prospect of this happening is clearly having an effect on the economy, Fed Chairman Ben S. Bernanke said at the end of the central bank’s two-day policy meeting yesterday.

Japanese exporters advanced as the yen weakened to as low as 83.67 per dollar, the least since March 21. A weaker currency boosts the value of overseas income at Japan’s carmakers and electronic manufacturers when repatriated.

Universal Entertainment

Canon rose 2.1 percent to 3,140 yen in Tokyo. Sony Corp., the maker of Bravia televisions and PlayStation game consoles, advanced 6.4 percent to 886 yen. Panasonic Corp., which makes televisions, cameras, home appliances and solar panels, jumped 7.9 percent to 481 yen. Toyota Motor Corp., the world’s biggest carmaker, gained 1.1 percent to 3,600 yen.

Universal Entertainment Corp. increased 6.5 percent to 1,409 yen in Osaka after the Japanese pachinko-machine maker signed a preliminary agreement with Robinsons Land Corp., controlled by Philippine billionaire John Gokongwei, to build a casino in Manila.

Relative Value

Mitsubishi UFJ increased 1.1 percent to 382 yen. The bank is close to purchasing 49 percent of Mitsubishi UFJ Merrill Lynch PB Securities Co. from Bank of America for 39 billion yen ($471 million), according to two people with knowledge of the matter. Separately, the lender is seeking to buy a 20 percent stake in VietinBank, according to two officials from the Tokyo-based lender, without disclosing terms of the agreement.

The MSCI Asia Pacific Index advanced in the past three weeks amid signs the world’s biggest economies are improving. The gauge traded at 14.3 times estimated earnings, compared with 13.8 times for the S&P 500 Index and 12.7 times for the Stoxx Europe 600 Index.

Chimei Innolux, a supplier of panels to Apple Inc., Sony and Dell Inc., climbed 6.9 percent to NT$15.55 in Taipei. The company is targeting net income of NT$30 billion to NT$50 billion ($1 billion to $1.7 billion) next year when sales are expected to increase 10 percent, the Economic Daily News reported, citing targets set by Chairman Tuan Hsing-Chien at an internal meeting.

Tata Motors Ltd. advanced 4.1 percent to 287.9 rupees in Mumbai, heading for its highest close since May 15, after the automaker said November retail sales of its Jaguar Land Rover unit climbed to a record, helped by demand in China.

Among stocks that dropped, Iluka Resources Ltd. sank 5.6 percent to A$8.16 in Sydney as the world’s largest zircon producer said prices for the mineral will continue to decline.

CLP Holdings Ltd. slipped 3.6 percent to HK$64.80 after Hong Kong’s biggest electricity producer sold HK$7.6 billion ($981 million) of shares at a discount to finance power projects.

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