Asian Stocks Rise Fourth Week as Yen Falls Before Polls
Asian stocks rose for a 12th day, leading the regional benchmark gauge to a fourth weekly gain, as Japan’s exporters advanced on a weaker yen before elections tomorrow expected to hand power to an opposition party pushing for more central bank easing.
Toyota Motor Corp. (7203) gained 1.8 percent. Guoco Group Ltd. jumped 31 percent in Hong Kong after the developer received a HK$8.25 billion ($1 billion) buyout offer. CLP Holdings Ltd., Hong Kong’s biggest electricity supplier, fell 2.8 percent after selling shares at a discount.
The MSCI Asia Pacific Index (MXAP) advanced 1 percent to 127.44 this week, with the gauge capping its longest streak of daily gains since January 2004. Japanese shares lifted the benchmark on bets Shinzo Abe’s Liberal Democratic Party will win this weekend.
“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,” said Grace Tam, Hong Kong-based global market strategist at JPMorgan Asset Management Ltd., which oversees about $1.3 trillion. “The overall environment is quite supportive for Asian equities.”
Asia’s benchmark equities index rose almost 17 percent from this year’s low on June 4 as central banks from the U.S., Europe, Japan and China took action to spur economic growth. The gauge traded at 14.4 times average estimated earnings, compared with 13.6 for the Standard & Poor’s 500 Index and 12.7 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Nikkei 225 Climbs
Japan’s Nikkei 225 Stock Average advanced 2.2 percent this week. South Korea’s Kospi Index climbed 1.9 percent. Australia’s S&P/ASX 200 rose 0.7 percent. New Zealand’s NZX 50 Index fell 1.5 percent in Wellington. Taiwan’s Taiex Index (TWSE) increased 0.7 percent. Singapore’s Straits Times Index rose 2 percent.
Hong Kong’s Hang Seng Index gained 1.9 percent. The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, added 4.3 percent. Shares on the gauge have rebounded 9.7 percent from an almost four-year low reached on Dec. 3. China’s industrial production climbed 10.1 percent in November while retail sales growth accelerated to 14.9 percent, the statistics bureau said Dec. 9.
Japanese exporters advanced as the yen fell to a nine-month low on speculation the opposition will return to power.Abe, leader of the LDP and front-runner to be the nation’s next prime minister, has called for unlimited easing and a doubling of the central bank’s inflation goal.
Toyota advanced 1.8 percent to 3,600 yen in Tokyo. Sony Corp. (6758), Japan’s No. 1 exporter of consumer electronics, gained 9.6 percent to 906 yen. Komatsu Ltd. (6301), which gets about 80 percent of its revenue outside Japan, rose 2.3 percent to 1,935 yen.
Companies that do business in the U.S. advanced after the Federal Reserve said it will expand its asset purchase program by buying $45 billion a month of Treasury bonds to further spur the economy. The central bank for the first time linked the outlook for its key rate to unemployment and inflation, signaling near-zero rates until 2015. Meanwhile, policymakers continued to spar over the U.S. budget. An agreement would help avert the so-called fiscal cliff, which could result in more than $600 billion in tax increases and spending cuts next year.
Samsung Electronics Co. (005930), which depends on the Americas for about 20 percent of its revenue, rose 2.4 percent to 1.515 million won in Seoul. Li & Fung Ltd. (494), a supplier of toys and clothes to Wal-Mart Stores Inc., rose 2.6 percent to HK$13.30T in Hong Kong.
CLP fell 2.8 percent to HK$65.15 after selling HK$7.6 billion ($981 million) of shares at a discount. China Longyuan Power Group Corp. slid 0.4 percent to HK$5.23 after saying it’s selling stock to fund wind and solar projects.
Guoco Group jumped 31 percent to HK$92 in Hong Kong after the property company received a HK$8.25 billion buyout offer from a group led by Malaysian billionaire Quek Leng Chan, its biggest shareholder.
Kawasaki Heavy Industries Ltd. (7012), which gets 20 percent of its sales from aerospace and defense, gained 6.3 percent to 204 yen in Tokyo after North Korea launched a long-range rocket on Dec. 12 in defiance of international sanctions, according to the South Korean and Japanese governments. Speco Co., a manufacturer of defense products, plunged 14 percent to 2,210 won in Seoul.
Sumco Corp. (3436), a maker of semiconductor wafers, surged 24 percent to 721 yen. Bank of America Merrill Lynch maintained a buy rating on the stock and raised its share-price forecast to 930 yen from 820 yen, saying wafer prices will increase.
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