Bloomberg News

Japanese Stock Futures Rise on U.S. Retail Sales, Fed

March 13, 2012

Pedestrians walk past a sign for Bank of Tokyo Mitsubishi UFJ Ltd. in Tokyo, Japan. Mitsubishi UFJ Financial Group Inc. is Japan’s largest lender. Photographer: Kiyoshi Ota/Bloomberg

Pedestrians walk past a sign for Bank of Tokyo Mitsubishi UFJ Ltd. in Tokyo, Japan. Mitsubishi UFJ Financial Group Inc. is Japan’s largest lender. Photographer: Kiyoshi Ota/Bloomberg

Japanese stock futures and Australian equities advanced after U.S. retail sales jumped by the most in five months and the Federal Reserve raised its assessment of the world’s biggest economy, boosting the earnings outlook for Asian exporters.

American depositary receipts of Toyota Motor Corp. (7203), Asia’s biggest carmaker by market value that gets 28 percent of its sales in North America, rose 1.9 percent from the closing share price in Tokyo. ADRs of Mitsubishi UFJ Financial Group Inc. (8306), Japan’s largest lender, advanced 2.1 percent after the Fed said 15 of the 19 largest U.S. banks have enough capital to weather another recession, boosting confidence in the global financial system. Rio Tinto Group (RIO), an Australian mining company, gained 2.1 percent in Sydney after oil and metal prices rose.

Futures on Japan’s Nikkei 225 Stock Average (NKY) closed above 10,000 yesterday in Chicago for the first time since July. Futures expiring in June closed at 10,015 in Chicago up from 9,840 in Osaka, Japan. They were bid in the pre-market at 10,020 in Osaka at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index gained 1.1 percent today. New Zealand’s NZX 50 Index added 1.2 percent in Wellington.

“The U.S. economy is generating jobs again and that’s helping boost household income, and I think the Fed’s comments recognize the improvement in the U.S. economy,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has almost $100 billion under management. “To a large degree, Asia takes a short-term lead from the U.S. We should see gains in Asian markets today.”

Retail Sales

Futures on the Standard & Poor’s 500 Index (SPXL1) were little changed today. The index advanced 1.8 percent and the Dow Jones Industrial Average advanced 1.7 percent to the highest level since 2007 in New York yesterday.

Stock rose as U.S. retail sales increased 1.1 percent in February. The Federal Reserve lifted its assessment of the economy as the labor market gathers strength. After the close of trading, the Fed said 15 of the 19 largest U.S. banks could maintain adequate capital levels even in a recession scenario.

The MSCI Asia Pacific Index (MXAP) rose 11.5 percent this year through yesterday, compared with an 11 percent gain by the S&P 500 and a 10.2 percent advance by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 14.9 times estimated earnings on average, compared with 13.4 times for the S&P 500 and 11.2 times for the Stoxx 600.

Chinese stocks traded in the U.S. jumped for a fifth day, led by Sohu.com Inc., on speculation the government will take further steps to bolster China’s economy once the annual Congress meeting ends. The Bloomberg China-US 55 Index of the most-traded Chinese equities in the U.S. gained 2.1 percent to 106.74 yesterday in New York, the highest level since Sept. 1.

The London Metal Exchange Index of prices for six industrial metals including copper and aluminum rose 1.4 percent yesterday. Oil for April delivery was at $106.77 a barrel, up 6 cents, in electronic trading on the New York Mercantile Exchange. The contract yesterday increased 37 cents to $106.71 a barrel, the highest close since March 9.

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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