Bloomberg News

Asian Stocks Outside Japan Rise on U.S. Jobs, China Data

December 10, 2012

Asian stocks gained, with a regional gauge excluding Japan heading for its highest close in more than a year, after U.S. jobs data topped estimates and China’s factory output and retail sales signaled a quickening economic recovery.

Yue Yuen Industrial Holdings Ltd. (551), a maker of shoes for Nike Inc., gained 1.7 percent in Hong Kong. Rio Tinto Group, the world’s second-largest mining company, rose 1.9 percent in Sydney after Chinese industrial production beat estimates. Advantest Corp., the largest producer of semiconductor-testing devices, jumped 3.9 percent in Tokyo after saying orders will rise. Hino Motors Ltd. slid 1.3 percent after recalling trucks in the U.S. due to a battery flaw.

The MSCI Asia Pacific excluding Japan Index gained 0.2 percent to 458.87 as of 7:41 p.m. Tokyo time, poised for its highest close since Aug. 4, 2011. A gauge that includes Japan was little changed, having erased gains of as much as 0.3 percent after a report showed China’s November exports increased at a slower pace than analysts forecast. The index climbed in the past three weeks amid signs of recovery in the world’s two largest economies.

“We could see a more sustained recovery in equity markets as China’s economy shows signs of gradual recovery,” said Yoji Takeda, who oversees about $1.2 billion as Hong Kong-based head of Asian equities at RBC Investment Management (Asia) Ltd. “There’s underlying uncertainty in Europe amid political maneuvering in Italy ahead of elections.”

Italian Prime Minister Mario Monti said he intends to resign, renewing concern nations in the euro currency bloc are grappling with a deepening debt crisis. This comes ahead of a Dec. 13-14 summit of European Union leaders to debate a road map for the overhaul of the 17-nation region.

China Output

China’s Shanghai Composite Index climbed 1.1 percent. The nation’s exports rose 2.9 percent in November from a year earlier, compared with the 9 percent median estimate of 31 analysts in a Bloomberg News survey and an 11.6 percent increase in October. Industrial production climbed 10.1 percent in November from a year earlier and retail sales growth accelerated to 14.9 percent, while inflation was 2 percent, the statistics bureau said yesterday.

Hong Kong’s Hang Seng Index added 0.4 percent. Singapore’s Straits Times Index gained 0.2 percent and Australia’s S&P/ASX 200 Index rose 0.1 percent. South Korea’s Kospi Index was little changed, erasing gains of as much as 0.7 percent.

Japan’s Nikkei 225 Stock Average added 0.1 percent, erasing gains of as much as 0.6 percent, while the broader Topix fell 0.2 percent. The nation’s gross domestic product shrank for a second consecutive quarter in the three months through September, putting the nation’s economy into a technical recession and underscoring opposition calls ahead of an election for stronger measures to stimulate demand.

U.S. Futures

Futures on the Standard & Poor’s 500 Index dropped 0.3 percent today. The S&P 500 rose 0.1 percent last week, a third week of gains and the gauge’s longest winning streak since August, as U.S. employment growth topped forecasts and investors weighed prospects for a budget agreement in Washington.

President Barack Obama and House Speaker John Boehner met yesterday at the White House to discuss the dispute over the U.S. budget, representatives of both said. An agreement would help avert the so-called fiscal cliff, which could result in more than $600 billion in tax increases and spending cuts taking effect next month.

Exporters to the U.S. advanced. Yue Yuen, which gets about 29 percent of its sales from the U.S., rose 1.7 percent to HK$26.40 in Hong Kong. Li & Fung Ltd. (494), a supplier of toys and clothes to retailers including Wal-Mart Stores Inc., added 1.1 percent to HK$13.10 in Hong Kong. Billabong International Ltd., Australia’s biggest surfwear maker, increased 3.5 percent to 88 Australian cents.

Metal Demand

Raw-material producers posted the biggest advance among the 10 industry groups in the MSCI Asia Pacific Index. Copper futures advanced for a second day on speculation demand from China, the biggest user, will increase as industrial production accelerated.

Rio Tinto Group (RIO), which gets about 31 percent of sales from China, climbed 1.9 percent to A$61.30 in Sydney. BHP Billiton Ltd. the world’s largest mining company, added 0.6 percent to A$34.95.

Fortescue Metals Group Ltd., Australia’s third-biggest iron-ore producer, surged 6.9 percent to A$4.05. BC Iron Ltd. agreed to raise its stake in an iron-ore joint venture with Fortescue for A$190 million ($199 million) to help boost its annual production by 80 percent.

Advantest, Sumco

The MSCI Asia Pacific Index advanced 16 percent through Dec. 7 from this year’s low on June 4 as central banks from Europe, the U.S., Japan and China took steps to support economic growth. The gauge traded at 14.2 times estimated earnings on average, compared with 13.7 times for the S&P 500 Index and 12.6 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Advantest Corp. jumped 3.9 percent to 1,108 yen in Tokyo. Orders will increase to about 30 billion yen ($363 million) this quarter and reach 70.5 billion yen for the six months ending March 31, or the lower end of the company’s forecast, President Haruo Matsuno said in an interview, challenging a Credit Suisse Group AG report that predicts a decline.

Sumco Corp. (3436), a maker of semiconductor wafers, surged 17 percent to 680 yen. Bank of America Merrill Lynch maintained a buy rating on the stock and raised its share-price forecast to 930 yen from 820 yen, saying wafer prices will increase.

Among stocks that fell, Hino Motors slid 1.3 percent to 700 yen. The company will recall about 35,200 trucks in the U.S. because of a battery flaw that could spark a fire.

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

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


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