Stock Futures in Hong Kong, Australia Rise; Japan Futures FallAdam Haigh
Stock futures in Hong Kong and Australia rose as the Federal Reserve begins a two-day policy meeting and a report showed U.S. homebuilder confidence soared to a seven-year high. Japanese equity futures declined.
American Depositary Receipts of BHP Billiton Ltd., the world’s largest mining company, climbed 1 percent from the close in Sydney. ADRs of Cathay Pacific Airways Ltd., the world’s largest cargo and freight carrier, added 0.2 percent. Those of carmaker Nissan Motor Co. sank 0.5 percent as the yen strengthened from the close of equity markets in Tokyo yesterday.
Futures on Japan’s Nikkei 225 Stock Average expiring in September closed at 12,955 in Chicago yesterday, down from 13,060 at the close in Osaka, Japan. They were bid in the pre-market at 12,990 in Osaka at 8:05 a.m. local time. Futures on Australia’s S&P/ASX 200 Index advanced 0.2 percent before the Reserve Bank of Australia releases minutes from its most recent policy meeting. Futures on Hong Kong’s Hang Seng Index gained 0.4 percent. New Zealand’s NZX 50 Index rose 0.6 percent.
“An unwinding of quantitative easing will strengthen the view that the U.S. recovery is constructive,” said Matthew Sherwood, the Sydney-based head of investment market research at Perpetual Ltd., which manages about $25 billion. “It is a case of taking your foot slightly off the accelerator, rather than applying it to the brake. Shares and credit should continue to be outperforming themes.”
Futures on the Hang Seng China Enterprises Index of mainland Chinese companies trading in Hong Kong added 0.6 percent. The Bloomberg China-US Equity Index of the most-traded Chinese shares in the U.S. climbed 1.9 percent in New York yesterday.
Futures on the Standard & Poor’s 500 Index rose 0.1 percent. The gauge yesterday climbed 0.8 percent as investors watched economic reports for clues to whether the economy is strong enough to allow the Fed to scale back its $85 billion in monthly bond buying.
Confidence among U.S. homebuilders surged in June to the highest level in seven years, reflecting gains in sales as Americans rushed to take advantage of low mortgage rates, a report showed yesterday. Separately, manufacturers in the New York region were more optimistic in June, indicating the area’s factories are looking beyond the current slowdown in growth.
About $2.7 trillion has been erased from the value of global equities since Bernanke indicated May 22 that stimulus aimed at bolstering the world’s largest economy could be scaled back.
That left the MSCI Asia Pacific Index, the benchmark regional equities gauge, yesterday trading at 12.7 times average estimated earnings compared with 14.9 for the Standard & Poor’s 500 Index and 13 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
The yen traded at 94.69 per dollar as of 7:57 a.m. in Tokyo, strengthening from 94.86 at the 3 p.m. close of Japanese equity markets yesterday.