Asian Stocks Gain First Time in Three Days on Utilities
Asian stocks rose for the first time in three days, with the regional benchmark index advancing from a three-week low as utilities and developers gained.
Tokyo Electric Power Co. (9501), operator of the crippled Fukushima Dai-Ichi nuclear power plant, rebounded 7.6 percent after declining 20 percent over the past five days. Country Garden Holdings Co. jumped 8 percent in Hong Kong after the mainland developer said it met its annual contract-sales target. Rakuten (4755) Inc., which operates an online mall, tumbled 12 percent in Tokyo after Yahoo Japan Corp. said it would eliminate vendor fees for its shopping and auction sites.
The MSCI Asia Pacific Index rose 0.4 percent to 138.43 as of 7:30 p.m. in Tokyo, erasing losses of as much as 0.3 percent. Stocks climbed as Chinese markets opened after a week-long holiday, during which combined retail and catering sales swelled 14 percent from a year earlier to 870 billion yuan ($142 billion), according to the Commerce Ministry.
“The broad impression I get is that the Chinese economy has pulled back from the slowdown scenario this year, but it’s not taking off,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has $131 billion under management.
HSBC Holdings Plc’s and Markit Economics’ purchasing managers’ index for China’s service industries fell to 52.4 in September from 52.8 in August, data showed today. A reading above 50 denotes expansion. The official non-manufacturing gauge for September released last week rose to its highest since March.
The Asia-Pacific stock measure closed yesterday at the lowest since Sept. 13 as a partial U.S. government shutdown stoked concern lawmakers will fail to raise the nation’s $16.7 trillion debt limit this month.
Japan’s Topix index erased losses to climb 0.2 percent today. South Korea’s Kospi index rose 0.4 percent. New Zealand’s NZX 50 Index fell 0.4 percent, while Australia’s S&P/ASX 200 Index slid 0.2 percent even as data showed business confidence surged last month to the highest in 3 1/2 years.
Hong Kong’s Hang Seng Index (HSI) gained 0.9 percent. Singapore’s Straits Times Index climbed 0.3 percent, and Taiwan’s Taiex index added 0.5 percent. The Shanghai Composite Index advanced 1.1 percent.
Futures on the Standard & Poor’s 500 Index slipped less than 0.1 percent after the gauge slumped 0.9 percent to a one-month low yesterday. Without an increase in the debt limit, the U.S. will exhaust its borrowing authority on Oct. 17 and would run out of funds to pay all of its bills sometime between Oct. 22 and Oct. 31, according to the Congressional Budget Office.
The MSCI Asia Pacific Index traded at 13.3 times estimated earnings, compared with 15.1 for the S&P 500 and 14 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
“The topic is the likelihood of a U.S. default, and that could be disruptive, but I don’t think at the moment people are assuming this is going to happen,” said Tim Leung, a Hong Kong-based portfolio manager who helps manage about $1.5 billion at IG Investment Ltd. “If the market assumes there will be a default, the index won’t be at this level.”
Utilities gained the most among the MSCI Asia Pacific gauge’s 10 industry groups with Tokyo Electric jumping 7.6 percent to 525 yen. Hokkaido Electric Power Co. rose 4.7 percent to 1,283 yen after the Japanese power company lost 6 percent yesterday.
Developers advanced. Country Garden soared 8 percent to a five-year high of HK$5.55. The company had contracted sales of 64.7 billion yuan by the end of September, compared with its 62 billion yuan target for the year. Guangzhou R&F Properties Company Ltd. surged 9.2 percent to HK$13.60.
Rakuten plummeted 12 percent to 1,196 yen. Yahoo Japan said it will eliminate fees and make it easier for shops to open on its online shopping service in a direct challenge to Rakuten, operator of Japan’s largest Internet mall. Yahoo dropped 6.5 percent to 535 yen.
Cokal Ltd., a coal mine developer, slumped 20 percent to 18.5 Australian cents in Sydney after saying takeover talks with Blumont Group Ltd. were affected by a record plunge in the buyer’s stock yesterday. Blumont soared 12 percent to 14.5 Singaporian cents today in Singapore after sinking a record 85 percent yesterday.
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