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Asian stocks rose as Capcom (9697) Co. forecast higher profit and Mitsubishi Corp. (8058) posted better-than- estimated earnings, helping the regional benchmark index rebound after political change in Europe drove its biggest loss in six months yesterday.
Capcom jumped 5.3 percent in Tokyo after the video-game developer said full-year net income will increase 46 percent. Mitsubishi, Japan’s biggest trading house, gained 3.7 percent after reporting profit that topped estimates. Iluka Resources Ltd. (ILU) slumped 12 percent in Sydney after the world’s largest zircon producer cut its forecast for output of the mineral.
“Fundamentals are still looking pretty solid and pretty strong,” Kelvin Tay, chief investment strategist at UBS Wealth Management in Singapore, said in a Bloomberg Television interview. UBS AG has about $1.6 trillion in client assets. “Yesterday was a knee-jerk reaction. It’s not sustainable.”
The MSCI Asia Pacific Index gained 0.2 percent to 121.47 as of 5:33 p.m. in Tokyo, with about five shares rising for every four that fell. The measure slumped 2.3 percent yesterday on concern Europe’s debt crisis may worsen and threaten the global economic recovery after Francois Hollande was elected France’s first Socialist president in almost two decades and Greek voters flocked to anti-bailout parties.
The Nikkei 225 Stock Average (NKY) gained 0.7 percent, recouping some of yesterday’s 2.8 percent slide. South Korea’s Kospi Index gained 0.5 percent and Australia’s S&P/ASX 200 Index advanced 0.3 percent. Hong Kong’s Hang Seng Index lost 0.3 percent. Trading volumes in Japan and Hong Kong were at least 13 percent below the 30-day average, according to data compiled by Bloomberg.
Futures on the Standard & Poor’s 500 Index fell 0.6 percent today. The stock gauge finished little changed yesterday in New York, recovering from a 0.4 percent decline after Warren Buffett said American lenders are in “fine shape,” propelling a rally in bank shares.
Capcom jumped 5.3 percent to 1,778 yen in Tokyo after the company predicted full-year net income will increase 46 percent to 9.8 billion yen ($123 million) on higher sales.
Mitsubishi gained 3.7 percent to 1,703 yen after the trading company reported full-year net income of 500 billion yen, topping the average 479.1 billion yen estimate in a Bloomberg survey.
Of the 433 companies on the MSCI Asia Pacific Index (MXAP) that have posted quarterly results since April 10, 151 exceeded expectations, while 171 missed analysts’ estimates, according to data compiled by Bloomberg News.
Fuji Heavy Industries Ltd. surged 7.3 percent to 602 yen, the most on the Asian gauge, after the maker of Subaru cars forecast a 25 percent jump in profit in the 12 months ending March 31 as it targets record vehicle sales on rising demand in China and the U.S.
Samsung SDI Co., which supplies batteries to Apple Inc., rose 3.1 percent 166,500 won in Seoul on speculation the company will expand its electric-car battery business. Samsung Electronics Co. Chief Operating Officer Lee Jae Yong met Volkswagen AG officials to discuss ways to cooperate on electric-car batteries, according to the Maeil Business Newspaper.
“The report increased speculation that Samsung owners are interested in the car-battery business,” Kim Byung Ki, an analyst at Kiwoom Securities Co., said by telephone today.
Iluka plunged 12 percent to A$14.01 in Sydney. The company cut its full-year zircon production forecast by about 14 percent, lowered sales estimates and increased production cost projections, citing the unclear global economic outlook.
The MSCI Asia Pacific Index has risen 6.5 percent this year through yesterday, compared with an 8.9 percent gain by the S&P 500 and a 4.2 percent advance by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 12.4 times estimated earnings on average, compared with a multiple of 13 for the S&P 500 and 10.6 times for the Stoxx 600.
Volatility declined as stocks climbed. The HSI Volatility Index (VHSI), a measure of options prices on the Hang Seng, fell 4.8 percent to 21.23. The Nikkei Stock Average Volatility Index (VNKY) dropped 7.8 percent to 20.82.
To contact the reporters on this story: Jonathan Burgos in Singapore at firstname.lastname@example.org; Adam Haigh in Sydney at email@example.com
To contact the editor responsible for this story: John McCluskey at firstname.lastname@example.org