Bloomberg News

Japan Stock Futures, Australian Shares Advance on Global Outlook

January 03, 2012

Jan. 4 (Bloomberg) -- Japanese stock futures and Australian shares gained after reports in the U.S. and Germany added to signs the global economy may be rebounding in the face of the European debt crisis.

American depositary receipts of Sony Corp., which earns 70 percent of its revenue overseas, gained 2.1 percent from the last close in Tokyo. Those of Komatsu Ltd. rose 2.6 percent after the Nikkei newspaper reported the construction machinery maker will invest as much as 15 billion yen ($195 million) in factories. BHP Billiton Ltd., Australia’s No. 1 oil producer and the world’s largest mining company by market valuation, climbed 3.6 percent after commodity prices increased.

The Bank of New York Mellon Asia ADR Price Index, which tracks American depositary receipts of the region’s companies, jumped 3.3 percent yesterday, the most since Nov. 30. Futures on Japan’s Nikkei 225 Stock Average expiring in March were bid in the pre-market at 8,520 in Osaka, Japan, at 8:05 a.m. Japanese markets were closed yesterday for a national holiday. Australia’s S&P/ASX 200 Index rose 1.3 percent today. New Zealand’s NZX 50 Index gained 0.3 percent in Wellington.

“Concerns about the global economic future are receding” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc. “Overseas markets across the board have started this year’s trading on a positive note as investors increase their tolerance to risk.”

Futures on the Standard & Poor’s 500 Index rose 0.1 percent today. The gauge advanced 1.6 percent yesterday in New York to the highest level since Oct. 28 as manufacturing across the globe recovered in December.

Global Manufacturing

In the U.S., a report yesterday showed factory output grew at the fastest pace in six months. Australian manufacturing expanded for the first time in six months and China’s manufacturing contracted for a second month in December, earlier reports showed. German unemployment fell more than forecast last month.

Construction spending in the U.S. rose in November for a third time in four months, another report showed.

Stocks maintained gains after the Federal Reserve said its officials will for the first time make public their own forecasts for the federal funds rate at a Jan. 24-25 meeting.

Crude oil for February delivery jumped 4.2 percent to settle at $102.96 a barrel in New York yesterday, the highest level since May 10, as concern persisted that further sanctions against Iran may disrupt shipments. An Iranian military official warned the U.S. against sending an aircraft carrier back to the Persian Gulf.

The London Metal Exchange Index of prices for six metals including copper and aluminum climbed 2.5 percent yesterday, the biggest advance since Nov. 30.

The Bloomberg China-US 55 Index of the most-actively traded Chinese equities gained 3.2 percent to 98.92 yesterday.

The MSCI Asia Pacific Index declined 17 percent last year. The S&P 500 broke even and the Stoxx Europe 600 Index dropped 11 percent. Stocks in the Asian benchmark are valued at 12.1 times estimated earnings on average, compared with 12.9 times for the S&P 500 and 10.1 times for the Stoxx 600.

--Editors: John McCluskey, Jason Clenfield

To contact the reporters on this story: Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net; Satoshi Kawano in Tokyo at skawano1@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net


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