Asian Stocks Climb as Japanese Exporters Gain on Yen
Asian stocks rose the most in two weeks as Japanese exporters advanced after the yen weakened overnight and higher sales of new homes in the U.S. added to recovery signs.
Nissan Motor Co. (7201), a Japanese carmaker that gets 79 percent of sales overseas, climbed 2.3 percent. Huaneng Power International Inc. jumped 6 percent in Hong Kong to a five-year high as the Chinese electricity producer reported profit more than doubled. Siam Makro Pcl surged 11 percent, heading for record close, after Billionaire Dhanin Chearavanont’s CP All Pcl offered to pay $6.6 billion for Thailand’s biggest discount store chain.
The MSCI Asia Pacific Index (MXAP) gained 1.4 percent 138.86 as of 7:45 p.m. in Tokyo, heading for its highest close since August 2011. Almost five shares rose for each that fell on the gauge. The measure climbed 5.8 percent this year through yesterday amid signs the U.S. economy is recovering and as Japanese equities rallied on speculation the government and central bank will succeed in ending deflation.
“The economy in the U.S. is hitting that sweet spot where it’s not bad enough to worry investors but not strong enough for the Federal Reserve to start withdrawing stimulus,” said Stan Shamu, a markets strategist at IG Markets Ltd. in Melbourne, a provider of trading services in currencies and equities. “It’s positive for the global economy. There are still heightened expectations of central-bank action.”
The Nikkei 225 Stock Average increased 2.3 percent, the highest close since June 2008, as the yen fell to as low as 99.77 against the U.S. dollar, before rebounding to 99.44. The broader Topix Index added 1.8 percent. A weaker yen boosts the value of overseas income at Japanese exporters when repatriated.
Australia’s S&P/ASX 200 Index jumped 1.7 percent. The nation’s consumer prices gained less than economists forecast last quarter, allowing the central bank scope to resume interest-rate reductions. New Zealand’s NZX 50 Index gained 0.5 percent after Reserve Bank Governor Graeme Wheeler kept borrowing costs unchanged today.
Shares on the benchmark MSCI Asia Pacific Index traded at 13.9 times estimated earnings as of yesterday compared with 14.3 for the Standard & Poor’s 500 Index and 12.7 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Futures on the Standard & Poor’s 500 Index added 0.2 percent today. The gauge climbed 1 percent yesterday as earnings from Travelers Cos. to Netflix Inc. beat estimates and new-home sales in the U.S. rose 1.5 percent in March.
A false report of explosions at the White House wiped $136 billion from the S&P 500 in about two minutes yesterday. The benchmark gauge was up 1 percent at 1:07 p.m. New York time when a posting on the Associated Press Twitter account said there had been explosions at the White House and President Barack Obama had been injured.
The U.S. benchmark index erased almost the entire gain, recovering from the plunge within three minutes after the news service said its Twitter account had been hacked and there were no explosions.
Japanese exporters advanced. Nissan gained 2.3 percent to 1,058 yen. Fanuc Corp. (6954), a maker of industrial robots that gets about half of its revenue overseas, increased 2.2 percent to 15,520 yen. Tokyo Electron Ltd., Japan’s biggest manufacturer of chip-making equipment, jumped 5.3 percent to 5,070 yen.
“A lot of the expectation for exporter earnings has been priced in, but forecasts are still conservative,” said Masaru Hamasaki, a senior strategist at Tokyo-based Sumitomo Mitsui Asset Management Co., which oversees about $102 billion. “Because companies are basing their forecasts on the assumption that the yen is near 80, we could see some big changes for this coming year.”
Mitsubishi Motors Corp., the maker of Lancer passenger cars and Pajero sports utility vehicles, surged 20 percent to 126 yen, the highest close since December 2010. The company raised its net income forecast for the year ended March 31 to 38 billion yen ($382 billion) from 13 billion yen previously.
Of the 62 companies on the MSCI Asia Pacific Index that have reported quarterly earnings since April 1 and for which estimates are available, 52 percent exceeded expectations, while 47 percent fell short of projections, according to data compiled by Bloomberg.
Huaneng Power (902) advanced 6 percent to HK$8.80 in Hong Kong, the highest close since November 2007. The operator of coal-fire power plants in China posted first-quarter net income of 2.55 billion yuan ($413 million), compared with 919.36 million yuan a year earlier.
Siam Makro surged 11 percent to 756 baht, heading for a record close, after CP All, which operates the 7-Eleven chain in the country, offered to buy the company for $6.6 billion, or 787 baht a share. CP All dropped 10 percent to 39 baht.
Among stocks that fell, Pharmaxis Ltd. (PXS) plunged 52 percent to 15 Australian cents, a record low, after the pharmaceutical company said it won’t proceed with a regulatory submission for a new drug after clinical trials were unsuccessful.
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