Asian Stocks Advance After U.S. Gauges Rally to Records
Asian stocks rose, with the regional benchmark gauge on course for its biggest increase in seven weeks, as investors weighed earnings and after U.S. equity indexes climbed to records.
Nissan Motor Co., Japan’s second-biggest carmaker, jumped 5.1 percent after full-year profit beat estimates and the company forecast higher dividends. PanAust Ltd., an Australian copper producer, soared 34 percent on a takeover bid from Guangdong Rising Assets Management Co. PetroChina Co. added 1.8 percent, headed for its highest close since Dec. 2 in Hong Kong, after announcing the sale of pipelines valued at $6.3 billion.
The MSCI Asia Pacific Index gained 1.1 percent to 139.23 as of 2:20 p.m. in Hong Kong, heading for the steepest advance since March 24, as all of its 10 industry groups rose. Shares maintained gains after data showed China’s economic slowdown is deepening.
“The U.S. is always the anchor both for confidence and global growth and it seems to be performing quite decently,” said Mikio Kumada, a Hong Kong-based global strategist at LGT Capital Partners. “It’s very hard for China to surprise the market in a positive way. It basically needs paradigm change.”
Futures on the Standard & Poor’s 500 Index rose 0.1 percent today. The S&P 500 and the Dow Jones Industrial Average both rallied to records yesterday as Internet and small-cap shares increased amid deals activity that boosted confidence in the world’s biggest economy.
U.S. Federal Reserve Chair Janet Yellen is due to speak May 15 after tempering concern last week that an improving economy will drive interest rates higher.
Regional Gauges
Japan’s Topix (TPX) index jumped 1.8 percent and South Korea’s Kospi index rose 0.9 percent. Australia’s S&P/ASX 200 Index added 0.9 percent and New Zealand’s NZX 50 Index gained 0.7 percent. Taiwan’s Taiex index rose 0.1 percent. Markets in Malaysia, Singapore, Thailand and Bangladesh are closed for a holiday.
Hong Kong’s Hang Seng Index advanced 0.3 percent after jumping the most in seven weeks yesterday on optimism state reforms will boost equity markets. The Hang Seng China Enterprises Index of mainland companies traded in the city added 0.2 percent.
Data today showed China’s industrial-output, investment and retail-sales growth unexpectedly slowed, suggesting the government’s efforts to counter an economic slowdown have yet to gain traction.
China Slowdown
Factory production rose 8.7 percent in April from a year earlier, the National Bureau of Statistics said today in Beijing, compared with the 8.9 percent median estimate of analysts surveyed by Bloomberg News. Fixed-asset investment increased 17.3 percent in the first four months of the year, and retail sales advanced 11.9 percent in April.
China’s broadest measure of new credit fell last month as authorities extended their campaign to tame financial dangers even as construction and manufacturing data point to risks that the economy’s slowdown will worsen. Aggregate financing was 1.55 trillion yuan ($248 billion) in April, the People’s Bank of China said yesterday in Beijing, compared with 2.07 trillion yuan in March.
Among companies on the Asian gauge that reported quarterly results since April 1 and for which Bloomberg had estimates, 53 percent beat earnings expectations as of yesterday, according to data compiled by Bloomberg.
The Asia-Pacific gauge traded at 12.6 times estimated earnings as of yesterday, compared with 16.1 for the S&P 500 and 15.2 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Source: bloomberg
