Bloomberg News

Most Asian Stocks Rise as Gold Miners, China Banks Gain

December 24, 2012

Most Asian stocks gained, led by gold producers and Chinese banks. Trading volume was low across the region ahead of the Christmas holiday amid speculation U.S. lawmakers will miss a deadline on budget talks.

Alacer Gold Corp. (AQG) led producers of the precious metal higher. China Construction Bank Corp., the nation’s second- largest lender, advanced 1.1 percent. Korea Gas Corp. (036460) slid 4.9 percent in Seoul after the world’s largest buyer of liquefied natural gas delayed the sale of asset-back securities.

About eight stocks gained for every seven that fell on the MSCI Asia Pacific excluding Japan Index, which rose 0.1 percent as of 5:22 p.m. in Hong Kong. Equity markets in Japan are closed today and markets in Australia, Hong Kong and Singapore shut early today. Time is running out for U.S. lawmakers to strike a budget deal by year end to avoid triggering more than $600 billion in tax increases and spending cuts.

“The negotiations about how to tackle the fiscal cliff seem to be running into a stalemate,” said Tim Leung, a portfolio manager who helps oversee about $1.5 billion at IG Investment Ltd. in Hong Kong. “This makes a relatively uncertain external environment for Asian equity markets with no one wanting to take new positions.”

The MSCI Asia Pacific excluding Japan Index is priced in U.S. dollars. Changes in currencies influence the value of its constituents.

The MSCI Asia Pacific Index (MXAP), which includes Japanese shares, dropped less than 0.1 percent to 128.23 today. Asia’s benchmark stock index has climbed about 13 percent in 2012 as central banks from Europe to the U.S. and Japan boosted stimulus measures to support economic growth.

The gauge trades at 14.6 times estimated earnings, compared with 13.8 on the Standard & Poor’s 500 Index and 12.8 on the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Holiday Trading

Australia’s S&P/ASX 200 Index gained 0.3 percent today after a gauge of metals prices advanced on Dec. 21. Volume was about 60 percent below its 30-day average for this time of day. New Zealand’s NZX 50 Index (NZSE50FG) gained 0.1 percent to 4,057.82, trading less than 20 points from a five-year high set on Dec. 20.

The BSE India Sensitive Index, or Sensex, rose 0.1 percent. Singapore’s Straits Times Index added 0.2 percent. South Korea’s Kospi Index added 0.1 percent. Taiwan’s Taiex Index slipped 0.1 percent.

Hong Kong’s Hang Seng Index (HSI) gained 0.2 percent, with the number of shares changing hands about 16 percent below the intraday average. The Hang Seng China Enterprises Index of mainland companies added 0.4 percent. Hong Kong’s market closed at noon today ahead of a two-day Christmas holiday.

Chinese Lenders

China Construction Bank gained 1.1 percent to HK$6.21. Bank of Communications Co., China’s fifth-largest lender by assets, increased 0.4 percent to HK$5.70 and Bank of China Ltd. advanced 0.3 percent to A$3.42.

Gold producers advanced today as an impasse in U.S. budget talks boosted demand for the precious metal as an investment haven. Alacer Gold surged 4.7. percent to A$4.71 and Integra Mining Ltd. climbed 2.6 percent to 49.75 Australian cents. Zijin Mining Group Co., China’s biggest producer of the metal by market value, gained 2.4 percent to HK$3.03.

Gold prices gained 0.6 percent to $1,657.25 an ounce on Dec. 21., rising from a four-month low.

The odds are that U.S. lawmakers won’t be able to reach a budget agreement after Republican House Speaker John Boehner failed to get his caucus’ support for “Plan B,” which would have extended tax cuts on incomes below $1 million, Senator Joseph Lieberman, a retiring Connecticut independent, told CNN.

Korea Gas

Futures on the S&P 500 Index dropped 0.5 percent. The gauge fell 0.9 percent on Dec. 21, the most in more than a month, after House Republicans scrapped the vote on higher taxes for top earners and sent budget talks deeper into turmoil.

Korea Gas slid 4.9 percent to 69,800 won today. The company postponed the sale of 5.4 trillion won ($5 billion) worth of asset-back securities, according to spokesman Park Gi Hung, saying the firm will proceed with the sale next year.

Innolux Corp. and AU Optronics Corp., Taiwan’s biggest makers of liquid-crystal displays, slumped in Taipei trading after the Economic Daily reported Chinese television makers will reduce orders.

Innolux lost 6.9 percent to NT$15.55 and AU Optronics slid 6.7 percent to NT$12.50. Both companies may not return to profit in the first quarter, the Economic Daily reported. Innolux spokesman Lin Chen-hui couldn’t be reached for comment, while Hsiao Yawen, spokeswoman for AU Optronics, declined to comment.

Billabong International Ltd. (BBG) slid 0.6 percent to 83 Australian cents as the Australian surf-wear company agreed to give a buyout group including Sycamore Partners LLC access to its financial data after reviewing their A$527 million ($548 million) offer.

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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