Bloomberg News

Asian Stocks Post Weekly Advance on U.S. Economy, BOJ

March 01, 2013

Asian stocks climbed for a second week, with the regional benchmark index posting its biggest weekly advance in two months, as U.S. economic data bolstered confidence in the global recovery and Japan’s prime minister nominated an advocate of stimulus to head the central bank.

Canon Inc., the world’s biggest camera maker, added 1.8 percent in Tokyo. Mitsubishi Estate Co. (8802) surged 16 percent, pacing gains among Japanese developers on speculation Haruhiko Kuroda, a nominee to lead the Bank of Japan (8301), will loosen monetary policy. Treasury Wine Estates Ltd. jumped 11 percent after Australia’s largest vintner posted earnings that beat analyst estimates.

The MSCI Asia Pacific Index (MXAP) climbed 0.9 percent to 134.70 this week, the biggest weekly advance since Jan. 4. The measure rose for a fourth month, its longest winning streak since September 2009, led by Japanese shares. Japan’s consumer prices fell for a third month, bolstering the case for more easing from the central bank.

“Deflation is so entrenched and that’s why expectations are high for the BOJ,” said Isao Kubo, Tokyo-based equity strategist at Nissay Asset Management Corp., which oversees about $54 billion. “They have to make bold moves to revive the economy if they really want to see inflation.”

The Nikkei 225 Stock Average (NKY) rose 1.9 percent this week, extending gains after capping a seven-month advance, the longest such streak since 2006. South Korea’s Kospi Index added 0.4 percent, while Hong Kong’s Hang Seng Index advanced 0.4 percent.

People’s Congress

China’s Shanghai Composite Index advanced 2 percent. The nation’s manufacturing expansion unexpectedly slowed in February ahead of a National People’s Congress next week that will set this year’s growth target. Australia’s S&P/ASX 200 Index rose 1.4 percent.

“There’s a dawning realization from many people that they are not being aggressive enough with their exposure to equities,” said Glenn Morgan, head of Australian equity sales at Deutsche Bank AG in Sydney. “The macro backdrop is still looking better and companies are delivering. There’s a weight of money sitting in cash, out of the market.”

The MSCI Asia Pacific Index benchmark traded at 14.8 times estimated earnings compared with 13.7 for the Standard & Poor’s 500 Index (SPX) and 12.4 for the Stoxx Europe 600 (SXXP), according to data compiled by Bloomberg.

Exporters advanced as reports showed orders for U.S. durable goods excluding transportation gear climbed in January by the most in a year, while pending home sales increased more than forecast. Federal Reserve Chairman Ben S. Bernanke said on Feb. 27 recent increases in some interest rates may signal the U.S. economy is gaining vigor.

Canon, Sony

Canon climbed 1.8 percent to 3,375 yen. Nintendo Co., the maker of Wii game consoles, added 1.6 percent to 9,070 yen in Osaka. Man Wah Holdings Ltd. (1999), a sofa maker that gets 51 percent of sales from the U.S., climbed 3.9 percent to HK$7.24 in Hong Kong.

Sony Corp. jumped 7.3 percent to 1,390 yen after Japan’s biggest consumer electronics maker sold a building in Tokyo for 111.1 billion yen ($1.2 billion). It’s the company’s third major asset sale this year as it strives to avoid a fifth straight annual loss.

Nomura Holdings Inc. advanced 3.6 percent to 550 yen after Japan’s biggest brokerage said it will sell a stake in its real estate unit for about 53 billion yen.

Developers Rally

Japanese property companies gained on speculation Kuroda will aggressively ease policy should he become BOJ chief. The central bank could usher in a growth spurt unseen in a generation by stepping up stimulus and ending deflation, according to Kuroda, president of the Asian Development Bank.

Mitsubishi Estate surged 16 percent to 2,450 yen. Mitsui Fudosan Co. (8801), Japan’s second-largest developer by market value, jumped 16 percent to 2,434 yen. Sumitomo Realty & Development Co. gained 20 percent to 3,320 yen.

New World Development Co., controlled by billionaire Cheng Yu-tung, rose 7.3 percent to HK$14.20, while Sino Land Co. gained 3.7 percent to HK$14.06. The Hong Kong-based developers advanced after posting earnings that beat estimates.

Of the 572 companies on the MSCI Asia Pacific Index that reported profits since January and for which estimates are available, 50 percent exceeded expectations, data compiled by Bloomberg showed.

Treasury Wine Estates jumped 11 percent to A$5.51 after saying first-half profit increased 31 percent to A$52 million ($53 million). The results beat the A$47 million median estimate of six analysts surveyed by Bloomberg.

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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