Asian Stocks Rise as U.S. Production Jumps; BHP Slumps on Bid for Potash
Westfield, the world’s largest owner of shopping centers, rallied 2.2 percent for the biggest gain in a month. Honda Motor Co. and Nintendo Co., which both get more than 40 percent of revenue from North America, advanced at least 2.4 percent. BHP Billiton Ltd. slumped 4.4 percent in Sydney, leading declines among material producers on speculation the company will make a hostile bid for Potash Corp. of Saskatchewan Inc.
The MSCI Asia Pacific gained 0.7 percent to 119.16 as of 7:31 p.m. in Tokyo. The index has advanced 1.6 percent in the past four days. It slumped 3.7 percent last week, the most since May, on signs the global economy is slowing.
“There are positive signs but I don’t think the market is 100 percent sure that there won’t be a double dip in the U.S.,” said Pauline Dan, Hong Kong-based chief investment officer at Samsung Investment Trust, which oversees the equivalent of $72.1 billion in assets. “There’s still a certain degree of uncertainty in the market. People want to see improvements in the U.S. employment and housing data.”
Japan’s Nikkei 225 Stock Average climbed 0.9 percent. South Korea’s Kospi index advanced 0.4 percent. Thailand’s SET Index rose 1.6 percent, while the Jakarta Composite Index in Indonesia gained 0.6 percent.
Hong Kong’s Hang Seng Index fell 0.5 percent and China’s Shanghai Composite Index lost 0.2 percent after a central bank adviser said real-estate curbs shouldn’t be reversed.
Futures on the Standard & Poor’s 500 Index were little changed. The index climbed 1.2 percent yesterday in New York, following higher-than-estimated earnings at Wal-Mart Stores Inc. and Home Depot Inc., and BHP Billiton’s $39 billion bid for Potash Corp.
U.S. industrial output in July climbed 1 percent, twice as much as forecast, as factories churned out more computers, appliances, automobiles and industrial machinery in a sign that manufacturing is shouldering a U.S. economic recovery, according to data released by the Federal Reserve yesterday.
The report eased concerns about the American economy and helped lift shares of Japanese exporters. The Topix Core 30 Index, comprised of Japan’s largest companies, rallied 1.4 percent for the biggest gain in three weeks.
Honda, which controlled 10.7 percent of the U.S. automobile market last month, climbed 2.4 percent to 2,827 yen. Nintendo, which makes the Wii game console, rose 4.6 percent to 23,350 yen. Yue Yuen Industrial Holdings Ltd., which makes shoes for Nike Inc., gained 1 percent to HK$25.10 in Hong Kong.
‘Sorrow To Joy’
“Investors are swinging from sorrow to joy with every tiny piece of economic data,” said Mitsushige Akino, chief fund manager overseeing $450 million in assets at Tokyo-based Ichiyoshi Investment Management Co.
Companies in the MSCI Asia Pacific trade at an average 13.9 times estimated profit, near the lowest level since December 2008. The index is more expensive than the S&P 500, which has a price-earnings ratio of 13.1, and the Stoxx Europe 600 Index, with a multiple of 11.6, according to data compiled by Bloomberg.
In Sydney, Westfield jumped 2.2 percent to A$12.57. Earnings excluding property revaluations and costs were A$1.03 billion ($931 million) in the first half as the company’s U.S. and U.K. malls recovered and the value of its properties rose. That beat a forecast of A$1.01 billion, according to the median of five analyst estimates compiled by Bloomberg.
“From an operating point of view, we’re not planning on a double dip,” Westfield co-Managing Director Peter Lowy said in a telephone interview. “Growth in sales from our retailers means we’re in a better position this year than we were last year.”
PICC Property and Casualty Co. surged 11 percent to HK$9.03, the biggest advance in the MSCI Asia Pacific Index, after saying first-half profit climbed to 2.645 billion yuan ($390 million). The higher-than-estimated results show the company is “firing on most cylinders” this year, Citigroup Inc. analysts said.
BHP, the world’s biggest mining company, tumbled 4.4 percent to A$38.42. The company may go directly to shareholders as early as this week with an unsolicited takeover offer for Potash Corp., the world’s largest fertilizer producer, said two people with direct knowledge of the matter. BHP confirmed after Australia’s stock markets closed that it will make the offer to Potash’s shareholders.
Potash Corp. rejected BHP’s initial $130-a-share offer yesterday, calling it “grossly inadequate,” and adopted a shareholder rights plan as a defense.
CSL Ltd., the world’s second-biggest maker of treatments derived from blood, slumped 2.7 percent to A$31.90. The company reported profit that missed analysts’ estimates after the Australian dollar’s strength eroded the value of overseas sales.
In Hong Kong, Chaoda Modern Agriculture (Holdings) Ltd. tumbled 18 percent to HK$6.98 after saying it will raise about a net $347 million by selling convertible bonds, new stock and options to fund the expansion of its production areas. The sale of additional stock may dilute the stake of existing shareholders.
Chinese real-estate companies fell after the Financial News reported central bank adviser Xia Bin as saying that the country shouldn’t make any short-term changes to its property market measures. The nation should take two years to “solve” real estate issues, it said. The Financial News is published by China’s central bank.
China Vanke Co., the country’s biggest developer, lost 1.7 percent to 8.79 yuan. Gemdale Corp., the fourth largest, fell 2.3 percent to 6.90 yuan.
In Japan, Hamamatsu Photonics K.K. climbed 6.4 percent to 2,606 yen. MSCI Inc. said it will add the Japanese maker of electron tubes and semiconductors to its World Index.
Nidec Corp., the world’s biggest maker of disk drive motors, rallied 3.4 percent to 7,390 yen after agreeing to buy Emerson Electric Co.’s motor and controls unit to expand its U.S. business.