Asian Stocks Rise After BOE Cut as Investors Await U.S. Payrolls

  • Regional benchmark gauge heads for first drop in four weeks
  • Chinese shares lead gains on bets for more PBOC stimulus

Asian stocks rose for a second day, paring a weekly decline, after the Bank of England eased policy and as investors looked to Friday’s U.S. jobs report for clues on the likely trajectory of American interest rates.

The MSCI Asia Pacific Index climbed 0.7 percent to 136.27 as of 4 p.m. in Hong Kong, trimming its drop since July 29 this week to 0.1 percent after three weeks of gains. Hong Kong’s Hang Seng Index advanced 1.5 percent on bets the People’s Bank of China will inject more stimulus into Asia’s largest economy, while Japan’s Topix index fell 0.2 percent after seesawing most of the day.

Asian equities rose the most since March last month amid expectations developed nations would add stimulus to cope with the threat to global growth from Britain’s vote to leave the European Union. They’ve struggled to hold onto those gains this week after Japan’s package of support measures disappointed many investors. The BOE unveiled additional spending aimed at containing the fallout from Brexit as it cut rates to a record on Thursday.

“In spite of the fact that it’s the first rate cut in seven years in the U.K., it was widely picked that this would occur,” said Michael McCarthy, chief market strategist at CMC Markets Asia Pacific Pty in Sydney. Markets will be in wait-and-see mode before U.S. payrolls “and the potential impact on Federal Reserve actions and U.S. interest rates,” he said.

Yen Slump

A 19 percent surge in Japan’s currency this year has wiped out almost half a trillion yen ($4.9 billion) from the operating income of Japan’s seven automakers in the first quarter, with Toyota Motor Corp. alone taking a 235 billion yen hit. Toyota predicted a 37 percent drop in future earnings on Thursday. Still, its shares rose 3 percent on Friday after first-quarter profit beat analyst estimates.

Hong Kong’s Hang Seng Index rose the most in three weeks and a gauge of Chinese stocks listed in the city jumped 1.4 percent. China Vanke Co., the nation’s largest residential property developer, closed up 1.8 percent in Hong Kong after China Evergrande Group bought a substantial stake in the company.

Finance companies led a 0.9 percent advance on India’s S&P BSE Sensex Index, the biggest increase in almost two weeks. Tata Steel Ltd. added 1.6 percent after the government extended the minimum import prices of steel. Foreigners have been net buyers of Indian shares for five straight months, the longest stretch since 2014. Indian lawmakers approved the creation of a national sales tax on Wednesday, which has the potential to add as much as 2 percentage points to growth, Finance Minister Arun Jaitley has said.

Indonesian GDP

Indonesia’s Jakarta Composite Index rose 0.7 percent and was on course for the highest close since April 2015 after the nation’s second-quarter growth beat estimates on an increased in government spending.

South Korea’s Kospi Index added 0.9 percent, Australia’s S&P/ASX 200 Index rose 0.4 percent and New Zealand’s S&P/NZX 50 Index increased 0.1 percent. Taiwan’s Taiex gauge was up 0.8 percent.

Futures on the S&P 500 Index gained 0.2 percent. The U.S. equity benchmark index closed little changed on Thursday.

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