Bloomberg News

Asia Stocks Head for Longest Winning Streak in Two Months

November 26, 2012

Asian stocks rose, with the benchmark regional gauge heading for its longest streak of gains in two months, as a weakening yen boosted the earnings outlook for Japanese exporters and U.S. consumer spending jumped during the Thanksgiving weekend.

Toyota Motor Corp. (7203), Asia’s largest carmaker, advanced 1.7 percent as the yen declined to a seven-month low against the dollar. Kangwon Land Inc. (035250) surged 13 percent in Seoul after the government approved plans for the casino and hotel operator to expand. Samsung Electronics Co. (005930) lost 2.3 percent, after closing at a record high in Seoul on Nov. 23, as Apple Inc. sought to add infringement claims over six more Samsung products to its multi-billion-dollar patent lawsuit against the company.

The MSCI Asia Pacific (MXAP) Index advanced 0.4 percent to 123.32 as of 8:08 p.m. in Tokyo. The measure is poised to gain for a fourth day, the longest winning streak since the second week of September. The Asian benchmark gained 13 percent from this year’s low on June 4 through Nov. 23 as central banks added stimulus to spur economic growth and data showed a slowdown in China may be ending.

“Conditions have improved,” said George Boubouras, Melbourne-based head of investment strategy at UBS AG’s Australian wealth management unit. The Swiss bank has about $1.5 trillion under management. “The U.S. consumer is in better shape.” There’s “the prospect of even further stimulus that will drive a weaker yen going forward” in Japan.

Japan’s Nikkei 225 Stock Average (NKY) rose 0.2 percent, a third day of gains, as investors bet shares will extend gains after polls showed opposition leader Shinzo Abe, who backs unlimited monetary easing and the adoption of a higher inflation target to spur the economy, will win a Dec. 16 election.

Yen Weakens

The yen weakened against most major peers after minutes of last month’s Bank of Japan policy meeting showed members calling for powerful monetary easing. A weaker yen boosts the value of exporters’ overseas income when repatriated.

Some BOJ members said the nation’s economy entered a recessionary phase, while one indicated the need for new ways to boost price expectations, the minutes published today showed.

Exporters climbed. Toyota Motor gained 1.7 percent to 3,575 yen and Nissan Motor Co. (7201) advanced 2.3 percent to 806 yen. BNP Paribas SA raised its rating on Toyota to buy from hold. Trading volume on the Nikkei 225 was 19 percent above the 30-day average for the time of day as Japan’s market reopened after a three-day weekend.

Hong Kong’s Hang Seng Index slid 0.2 percent and China’s Shanghai Composite Index lost 0.5 percent. South Korea’s Kospi Index slid 0.2 percent and Australia’s S&P/ASX 200 Index rose 0.3 percent. Singapore’s Straits Times Index climbed 0.5 percent and Taiwen’s Taiex Index jumped 1.1 percent.

U.S. Futures

Futures on the Standard & Poor’s 500 Index fell 0.4 percent today. The S&P 500 advanced 3.6 percent last week, extending its 2012 gain to 12 percent, after President Barack Obama expressed confidence on a budget agreement with Congress and data from China to Germany bolstered optimism about global growth.

American shoppers spent 13 percent more during the four-day Thanksgiving weekend. Spending rose to $59.1 billion from Nov. 22 through Nov. 25 from $52.4 billion last year, the National Retail Federation said in a statement. The jump occurred even as Chicago-based researcher ShopperTrak observed a 1.8 percent decline in sales on Black Friday, the traditional start to the shopping season.

Euro-area finance ministers return to Brussels today to try for the third time this month to clear an aid payment to Greece and forge a blueprint for keeping the country a solvent member of the 17-member single currency bloc. At stake is the continuation of a three-year mission to return Greece to financial health.

In South Korea, consumer confidence rose from a nine-month low this month as the economy began to show signs of improvement. The sentiment index was at 99 from 98 in October, the Bank of Korea said in an e-mailed statement today. A reading below 100 indicates pessimists outnumber optimists.

The MSCI Asia Pacific Index traded at 13.8 times estimated earnings on average, compared with 13.6 for the S&P 500 and 12.4 for the Stoxx Europe 600 Index.

Kangwon Land soared 13 percent to 31,500 won as the company received approved for its plan to increase casino tables and slot machines. HMC Investment Securities Co. raised its target price for Kangwon shares by 12 percent to 38,000 won, while Daishin Securities Co. increased its price estimate by 4 percent.

Japanese utilities gained after the Asahi newspaper reported Kansai Electric Power Co. (9503) is seeking a 12 percent jump for household electricity rates and Kyushu Electric Power Co. asked for an 8.5 percent increase. Kansai gained 5.3 percent to 754 yen, and Kyushu advanced 5.3 percent to 812 yen.

Samsung lost 2.3 percent to 1.404 million won. Apple has said that Samsung products running on the new Android “Jelly Bean” operating system, and other products running on the “Ice Cream Sandwich” system should be added to the case, according to filings in San Jose federal court in California. Jelly Bean is Google Inc.’s latest version of the Android operating system that runs on Samsung mobile devices.

Cathay Pacific Airways Ltd. (293) fell 0.9 percent to HK$13.76 in Hong Kong as Chief Executive Officer John Slosar told staff the carrier must reduce expenses as it faces a challenging year.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

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


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