Asian Stocks Rise on U.S. Home Sales, Durable Goods Data
Asian stocks rose for a second day after reports showed U.S. home sales and durable goods orders climbed more than estimated and investors awaited the start of a summit on Europe’s debt crisis.
Toyota Motor Corp. (7203) advanced 2.6 percent, leading gains among Japanese carmakers. Daiei Inc. (8263), an operator of department stores, jumped 11 percent as Japanese retail sales gained more than estimated in May. News Corp. gained 4.1 percent in Sydney as a person with knowledge of the situation said the board approved in principle a plan to split the company’s publishing unit from its entertainment division.
The MSCI Asia Pacific Index (TPX) advanced 0.8 percent to 114.98 at 7:18 p.m. in Tokyo. Five stocks rose for every four that fell. The gauge fell 12 percent through yesterday from its highest level of 2012 in February amid concern growth in China and the U.S. is slowing as the euro-zone debt crisis escalates.
“The U.S. economy is recovering bit by bit,” said Yoshihisa Okamoto, who helps oversee about $34 billion at Mizuho Asset Management Co. in Tokyo. “The economic data was good, boosting the markets. Worries about the U.S. housing market are fading. There was concern U.S. efforts to lower interest rates weren’t raising demand for housing, but these may start taking effect.”
The MSCI Asia Pacific Index (MXAP)’s 0.2 percent gain this year through yesterday compares with a 5.9 percent advance by the S&P 500 and a 0.5 percent increase on the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 11.7 times estimated earnings on average, compared with 12.8 times for the S&P 500 and 10.3 times for the Stoxx 600.
Hong Kong’s Hang Seng Index dropped 0.8 percent, reversing and earlier increase after China’s Shanghai Composite Index closed below the 2,200 level that marked the erasure of all the year’s gains. Japan’s Nikkei 225 Stock Average rose 1.7 percent. South Korea’s Kospi added 0.1 percent and Australia’s S&P/ASX 200 Index was little changed.
Futures on the Standard & Poor’s 500 Index fell 0.4 percent today. The stock gauge gained 0.9 percent in New York yesterday as orders for durable goods and the number of Americans signing contracts to buy an existing home rebounded in May. The index of pending home resales climbed 5.9 percent after a 5.5 percent decline in April, the National Association of Realtors reported. Economists forecast a 1.5 percent gain.
Orders for durable goods climbed more than forecast in May, easing concern that U.S. manufacturing is faltering. Bookings rose 1.1 percent, a Commerce Department report showed. The median forecast of economists surveyed by Bloomberg News called for a 0.5 percent gain.
In Europe, German Chancellor Angela Merkel shut the door to joint euro-area bonds as a means of lowering Spain’s borrowing costs, saying they are the “wrong way” to achieve the greater European integration needed to stem the debt crisis.
Speaking three hours after Spanish Prime Minister Mariano Rajoy made a plea for help from today’s European leaders’ summit in Brussels, Merkel said that euro bonds, euro bills and debt redemption funds are unconstitutional in Germany and economically “wrong and counterproductive.”
Exporters that generate sales in the U.S. advanced. Toyota, which gets 20 percent of its revenue in North America, advanced 2.6 percent to 3,110 yen in Tokyo. James Hardie Industries SE, a manufacturer of home siding, rose 0.5 percent to A$7.70 in Sydney. Techtronic Industries Co. (669), a maker of power tools and vacuum cleaners, increased 0.9 percent to HK$9.63 in Hong Kong.
Daiei gained 11 percent to 255 yen after the retail-sales data in Japan. Shimamura Co., a clothing retailer, rose 2.6 percent to 9,010 yen. The Trade Ministry said retail sales advanced 3.6 percent from a year earlier after a 5.7 percent increase in April.
News Corp. gained 4.1 percent to A$22.37 in Sydney. An announcement is planned tomorrow morning, said a person with knowledge of the situation, who asked not to be identified because the decision isn’t public. In an e-mail, the company declined to comment.
Eisai Co. (4523) jumped 3.1 percent to 3,475 yen in Tokyo after its partner won Food and Drug Administration approval for weight-loss pill lorcaserin, making it the first obesity medication cleared for sale in the U.S. in 13 years.
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