Asia Stocks Rise on China Services; Investors Watch U.S.Yoshiaki Nohara and Kana Nishizawa
Asian stocks rose after a gauge of China’s services industries jumped to a six-month high and as investors watched for progress on ending a budget impasse that has shut down the U.S. government.
Sands China Ltd., a unit of billionaire Sheldon Adelson’s Las Vegas casino company, advanced 3.9 percent after its equity rating was raised at DBS Vickers Hong Kong Ltd. China Unicom (Hong Kong) Ltd. surged 8.4 percent on a report fees for calls to other networks will be cut. SoftBank Corp. rose 4 percent, overtaking Mitsubishi UFJ Financial Group Inc. as Japan’s No. 2 company by value. Leighton Holdings Ltd. slumped 10 percent on a report former executives knew of alleged corruption at Australia’s biggest builder.
The MSCI Asia Pacific Index added 0.4 percent to 139.26 as of 7:34 p.m. in Tokyo, with eight of 10 industry groups on the measure rising.
“Investor sentiment is holding well,” Benjamin Tam, a Hong Kong-based portfolio manager at IG Investment Ltd., which oversees about $1.5 billion, said by telephone. “People are still optimistic about China’s economy. Having said that, we are waiting on results of fiscal talks in the U.S., which is the biggest uncertainty.”
Hong Kong’s Hang Seng Index advanced 1 percent after data showed China’s non-manufacturing Purchasing Managers Index climbed in September to 55.4 from 53.9 in August, adding to signs that the world’s second-biggest economy will rebound after a two-quarter slowdown. Financial markets in China are closed for holidays until Oct. 8. South Korea’s market was also shut today.
Japan’s Topix index slipped 0.1 percent, falling a fifth day to cap its longest losing streak since November. Australia’s S&P/ASX 200 Index rose 0.4 percent, while New Zealand’s NZX 50 Index was little changed. Taiwan’s Taiex index jumped 1.7 percent. Singapore’s Straits Times Index lost 0.3 percent.
The Philippine Stock Exchange Index gained 0.4 percent, erasing earlier losses of as much as 1 percent, after Moody’s Investors Service raised the country’s credit rating to investment grade. India’s S&P BSE Sensex Index climbed 2 percent.
Futures on the Standard & Poor’s 500 Index dropped 0.3 percent today after the measure slipped 0.1 percent yesterday. The U.S. government has been in partial shutdown for two days after lawmakers failed to agree on a federal budget. President Barack Obama summoned the top four leaders of Congress to the White House for the first high-level talks on reopening the government and raising the debt ceiling.
Obama’s meeting with Congress leaders “is something he should’ve done weeks ago, but it is a positive development,” Matthew Sherwood, head of investment markets research in Sydney at Perpetual Investments, which manages about $25 billion, said by telephone. “Investors have been factoring the shutdown in progressively and what they haven’t factored in yet is delaying the resolution to the debt ceiling, and so my expectation is that volatility will pick up.”
The MSCI Asia Pacific Index rallied 6.4 percent in September, the biggest monthly advance since January 2012. The measure traded at 13.5 times estimated earnings, compared with 15.3 for the S&P 500 and 14.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Japan’s Topix climbed 37 percent this year, the most among developed markets, amid optimism Prime Minister Shinzo Abe and the Bank of Japan can lead the country out of deflation through unprecedented monetary easing.
Gaming shares advanced after data from Macau’s Gaming Bureau showed casino revenue jumped 21 percent in September from a year earlier. Shares also climbed after visitors to Macau on Oct. 1-2 rose 14 percent from a year earlier amid National Day celebrations.
Sands China rose 3.9 percent to HK$50.60, the third-biggest gain on the Hang Seng Index, after DBS Vickers raised its rating to buy from hold and boosted its 12-month target price to HK$57.10. Galaxy Entertainment Group Ltd., the casino operator controlled by billionaire Lui Che-woo, advanced 5.1 percent to HK$58.70.
China Unicom, the nation’s second-largest mobile carrier, soared 8.4 percent to HK$13.12. China Telecom Corp. increased 7.6 percent to HK$4.12. Interconnection fees for calls from the companies’ networks to China Mobile Ltd. may be halved to 0.03 yuan per minute, Economy & Nation Weekly reported today, citing an unidentified person. China Mobile slumped 0.7 percent to HK$86.50.
SoftBank jumped 4 percent to 7,530 yen. Billionaire Chairman Masayoshi Son is forecasting record domestic earnings this year as he accelerates the addition of new subscribers and after buying a controlling stake in Sprint Corp. With today’s gain, the mobile phone operator’s market value exceeded that of Mitsubishi UFJ to become Japan’s second-largest company by value after Toyota Motor Corp.
Leighton Holdings tumbled 10 percent to A$17.54, the most in more than two years. The builder allegedly paid bribes to win contracts, conduct that former chief executive officers Wal King and David Stewart were aware of, the Age newspaper reported. The reports quote from an alleged memo from Stewart dated Nov. 23, 2010. Former Leighton International Managing Director David Savage said he and King knew of an alleged A$42 million bribe paid in relation to work in Iraq, the newspaper quoted the memo as saying.
King denied the allegation and a spokeswoman for Stewart declined to comment. Leighton, which has been under investigation since at least February 2012, said the revelations weren’t new.