Bloomberg News

Japanese Stock Futures Rise on Greek Optimism; BOJ, Fed Meet

March 12, 2012

Japanese stock futures rose amid optimism euro-area finance chiefs will complete a second Greek bailout this week, boosting demand for riskier assets. Trading of Asian equities may be limited ahead of policy announcements by the Bank of Japan and the Federal Reserve today.

American depositary receipts of Canon Inc. (7751), a Japanese camera maker that gets 31 percent of its revenue in Europe, rose 0.4 percent from the closing share price in Tokyo. Shares of Kawasaki Kisen Kaisha Ltd. may be active as Japan’s third- largest shipping firm by market value prepares to start joint shipping services with other cargo lines. Australian stocks rose, led by mining company Mineral Deposits Ltd.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring in June closed at 9,865 in Chicago yesterday, up from 9,800 in Osaka, Japan. They were bid in the pre-market at 9,850 in Osaka at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index rose 0.6 percent today. New Zealand’s NZX 50 Index advanced 0.2 percent in Wellington.

“It seems like the Greek bond deal is going through; that issue is off the table, at least for the time being,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $150 billion. “I wouldn’t expect much out of the BOJ, and obviously people will wait and see what the Fed says.”

Greek Bailout

Futures on the Standard & Poor’s 500 Index (SPXL1) rose less than 0.1 percent today. The index was little changed in New York yesterday. Euro-area finance ministers gather in Brussels to sign off on a 130 billion-euro ($171 billion) second package for Greece as they focus on Spain’s budget-cutting efforts and Portugal’s aid program.

Luxembourg Prime Minister Jean-Claude Juncker, who heads the group of euro-region finance ministers, said he had “no doubt” that the package would be approved and he expected a final decision on March 14.

The Bank of Japan is ending a two-day meeting today. The central bank on Feb. 14 surprised the market by increasing its government bond purchase program and setting an inflation goal of 1 percent, weakening the yen and boosting stocks.

The Federal Reserve is also wrapping up a policy meeting today. The Wall Street Journal last week reported the Fed is considering a strategy that would allow it to undertake another round of bond buying, while lowering the risk of inflation.

The MSCI Asia Pacific Index (MXAP) gained 11 percent this year through yesterday, compared with a 9 percent advance by the S&P 500 and an 8.3 percent increase by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 14.7 times estimated earnings on average, compared with 13.1 times for the S&P 500 and 11 times for the Stoxx 600.

Chinese Stocks

Tudou Holdings Ltd. soared to a record in New York, driving gains in Chinese U.S.-listed Internet shares, on plans by Youku Inc. to acquire the nation’s second-largest video sharing website in a $1 billion deal. The Bloomberg China-US 55 index of the most-traded Chinese stocks in the U.S. gained 0.3 percent to a one-week high of 104.52 in New York.

Crude for April delivery declined 1 percent to settle at $106.34 a barrel on the New York Mercantile Exchange yesterday.

To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

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


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