Asian Stocks Advance on U.S. Economic Optimism, Yen
Asian stocks rose, with Japan’s Nikkei 225 Stock Average closing at the highest in six years as the yen touched a sixth-month low against the dollar after U.S. employment and consumer confidence reports boosted optimism in the world’s largest economy.
Honda Motor Co. (7203), a carmaker that gets almost half its sales in the U.S. added 1.5 percent. Warrnambool Cheese & Butter Factory Co. advanced 0.8 percent after Murray Goulburn Cooperative Co., Australia’s biggest milk processor, raised its takeover offer. Forge Group Ltd. slumped 84 percent in Sydney after the mining-services firm said it will report a 2014 loss.
The MSCI Asia Pacific Index gained 0.7 percent to 142.00 as of 5:04 p.m. in Hong Kong, with all 10 industry groups on the measure rising. More than $8 trillion has been added to the value of global equities this year, the biggest increase since 2009, as central banks took steps to shore up economies worldwide. The Asia-Pacific gauge jumped 9 percent in 2013 through yesterday, while falling 0.9 percent on the month.
“Asia’s earnings growth does remain largely leveraged to the global economy,” Michael Kurtz, Hong Kong-based head of global equity strategy at Nomura Holdings Inc., said in an e-mail. “Our economists expect the U.S. economy finally to accelerate to a more robust pace in 2014.”
Japan’s Nikkei 225 increased 1.8 percent to 15,727.12, the highest closing level since December 2007. Japan’s Topix index rose 1.1 percent as Honda gained 1.5 percent to 4,305 yen. Australia’s S&P/ASX 200 Index was little changed, while New Zealand’s NZX 50 Index gained 0.2 percent. South Korea’s Kospi index added 0.8 percent.
Hong Kong’s Hang Seng Index fell 0.1 percent, retreating from a 10-month high. China’s Shanghai Composite Index rose 0.8 percent. Singapore’s Straits Times Index added 0.5 percent, while Taiwan’s Taiex Index climbed 0.8 percent.
Data yesterday showed fewer Americans than projected filed applications for unemployment benefits last week, a sign that the labor market is showing resilience. The Thomson Reuters/University of Michigan final index of consumer sentiment in November unexpectedly rose to 75.1 from 73.2 a month earlier. The median forecast of 65 economists surveyed by Bloomberg called for 73.1.
Futures on the Standard & Poor’s 500 Index added 0.1 percent, with U.S. exchanges closed today for the Thanksgiving holiday. The S&P 500 has climbed 27 percent this year, heading for the biggest annual gain since 1998, as the Fed pressed on with its stimulus program. The gauge closed at a record 1,807.23 yesterday. About 4.8 billion shares changed hands on U.S. exchanges, the slowest trading since Aug. 26.
Former Federal Reserve Chairman Alan Greenspan said the U.S. economy probably will grow more slowly next year than some forecasters predict and indicated that a record U.S. stock market isn’t in a bubble.
The MSCI Asia Pacific Index yesterday traded at 13.9 times estimated earnings, close to the multiple of 14 reached on Nov. 18, which was the highest since May, according to data compiled by Bloomberg. That compares to a current multiple of 16.3 on the S&P 500 and 15.2 for the Stoxx Europe 600 Index.
Bank of Japan Governor Haruhiko Kuroda helped drive a 47 percent surge in Japan’s Topix this year by maintaining monetary easing as he and Prime Minister Shinzo Abe sought to jolt the nation out of 15 years of deflation. The Topix is the best performing of 24 developed markets tracked by Bloomberg, on course for its biggest annual advance since 1999.
Warrnambool Cheese rose 0.8 percent to A$9.32. Murray Goulburn, which needs Australian regulator approval for its bid, boosted its offer by 5.6 percent to A$9.50 a share, topping Saputo Inc.’s recommended A$9.20 conditional offer and a cash and share offer from Bega Cheese Ltd.
Cathay Pacific Airways Ltd. added 1.9 percent to HK$16.84 after UBS AG reiterated its buy recommendation and raised its price forecast for Hong Kong’s biggest carrier.
Forge tumbled 84 percent to 68.5 Australian cents. Forge, whose clients include Rio Tinto Group, lost more than A$300 million ($274 million) in market value to trade as low as 28.5 cents in Sydney today after saying cost overruns and poor management at two Australian projects also forced it to negotiate new debt terms.
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