Asian Stocks Rise as Index Rebounds From Three-Month Low
Asian stocks rose, with the regional benchmark rebounding from a three-month low, as investors await the outcome of a Federal Reserve meeting after reports showed manufacturing accelerated in the U.S. and Europe.
Honda Motor Co. (7267), a Japanese carmaker that gets 46 percent of sales in North America, climbed 0.7 percent. Dai-ichi Life Insurance Co. (8750) rose 3.8 percent in Tokyo after Barclays Plc advised buying the shares. Daewoo Engineering & Construction Co. (047040) led declines on the regional equity gauge after a South Korean regulator began inspecting the company’s accounting practices.
The MSCI Asia Pacific Index gained 0.4 percent to 137.60 in Hong Kong, with nine of 10 industry groups rising. The measure fell the past two weeks as improving U.S. economic data spurred bets stimulus will be reduced. The Fed will start paring $85 billion of monthly bond purchases when it concludes a two-day policy meeting tomorrow, according to 34 percent of economists surveyed Dec. 6 by Bloomberg.
“With signs of recovery worldwide and stronger economic data, optimism has seemingly returned ahead of the key U.S. Federal Reserve decision due later this week,” Tracey Warren, a Sydney-based trader at CMC Markets Stockbroking Ltd., said in an e-mail. “With last month’s positive payroll data and the economy continuing to show signs of growth, some believe that imminent moment could come as soon as this week’s meeting.”
U.S. industrial production climbed in November by the most in a year, data showed yesterday. Earlier data showed unemployment fell to a five-year low and third-quarter economic growth was stronger than forecast. Euro-area manufacturing reached a 31-month high in December, led by Germany, according to a survey from London-based Markit Economics.
Japan’s Topix index and the Nikkei 225 Stock Average both climbed 0.8 percent. Honda Motor rose 0.7 percent to 4,090 yen. Sharp Corp., which gets about 60 percent of revenue abroad, climbed 0.6 percent to 332 yen.
Australia’s S&P/ASX 200 Index gained 0.3 percent, paring gains of as much as 0.9 percent after Treasurer Joe Hockey said Australia’s budget deficit will balloon to A$47 billion ($42 billion) this fiscal year.
New Zealand’s NZX 50 Index slid 0.2 percent. South Korea’s Kospi index added 0.2 percent. Hong Kong’s Hang Seng Index fell 0.2 percent, while China’s Shanghai Composite lost 0.5 percent. Singapore’s Straits Times Index rose 0.5 percent, and Taiwan’s Taiex Index advanced 0.5 percent.
Daewoo Engineering lost 11 percent to 6,940 won. South Korea’s Financial Supervisory Service received information that the company allegedly violated accounting rules, the regulator said in an e-mailed statement yesterday, without elaborating. The company said it has not been contacted by the regulator, according to a Reuters report.
The MSCI Asia Pacific Index gained 6.4 percent this year as central-bank stimulus shored up global economic growth. The Asia-Pacific gauge traded at 13.6 times estimated earnings yesterday, compared with 16.1 for the Standard & Poor’s 500 Index and 14.7 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
The Topix rose 43 percent this year, the most among 24 major developed markets tracked by Bloomberg, amid unprecedented stimulus by the Bank of Japan in support of Prime Minister Shinzo Abe’s efforts to end 15 years of deflation.
Futures on the S&P 500 Index slid less than 0.1 percent. The gauge yesterday halted a four-day losing streak, rising 0.6 percent. Fed policy makers have scrutinized data and U.S. budget negotiations to determine whether economic growth is robust enough to withstand withdrawal of monetary support. The House last week passed a budget that limits automatic spending cuts and avoids another government shutdown.
Dai-ichi Life climbed 3.8 percent to 1,620 yen after Barclays raised its recommendation on the stock to overweight from equal-weight and boosted its price target to 2,050 yen from 1,300 yen.
Envestra Ltd. surged 4.7 percent to A$1.12. APA Group agreed to buy the rest of distribution company for the equivalent of A$1.17 a share, depending on Envestra shareholder approval. That’s 9 percent more than yesterday’s closing price of A$1.07, which is the equivalent price of the initial July bid.
Sands China Ltd rose 1.5 percent to HK$64.65. Wynn Macau Ltd., a unit of billionaire Steve Wynn’s gaming company, advanced 3 percent to HK$36.15. Macau’s gross gaming revenue this month could rise 19 percent from a year earlier, Barclays Plc said.
Insurance Australia Group Ltd. sank 5.3 percent to A$5.40 in Sydney after saying it will raise A$1.2 billion in a share sale to fund the purchase of Wesfarmers Ltd.’s underwriting businesses in Australia and New Zealand for A$1.85 billion ($1.66 billion) to become the largest insurer in Australia.
Pact Group Holdings Ltd. (PGH) declined 13 percent to A$3.32 as the packaging firm debuted on the Australian stock market.
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