Bloomberg News

Japan Stock Futures, Australian Shares Gain as Europe Woes Wane

April 02, 2013

Japanese stock futures and Australian shares climbed as concern regarding Europe’s debt crisis eased and better-than-estimated U.S. factory orders added to optimism the world’s largest economy is growing.

American Depositary Receipts of Canon Inc. (7751), the camera maker that gets about 80 percent of sales outside Japan, rose 1 percent. Komatsu Ltd. (6301), a Japanese maker of construction equipment that gets a quarter of its revenue in the Americas, gained 1.3 percent. Alacer Gold Corp. dropped 5.9 percent in Sydney as the price of the precious metal retreated.

Futures on Japan’s Nikkei 225 Stock Average (NKY) expiring in June closed at 12,170 in Chicago yesterday, up from 12,030 at the close in Osaka, Japan. They were bid in the pre-market at 12,160 in Osaka at 8:05 a.m. local time. Australia’s S&P/ASX 200 Index (AS51) rose 0.4 percent and New Zealand’s NZX 50 Index advanced 0.2 percent.

“The U.S. economy does look better and the problems in Europe look a little less scary,” said Shane Oliver, Sydney- based head of investment strategy at AMP Capital Investors Ltd., which has $126 billion under management. “It’s probably more of a buying opportunity for equities and I’d caution about getting too bearish. Fears regarding Cyprus are fading.”

Orders placed with U.S. factories rose the most in five months in February, boosted by a pickup in demand for motor vehicles and commercial aircraft, a Commerce Department report showed yesterday.

Cyprus Bailout

The Cypriot government completed talks on the terms for aid with the so-called troika of officials representing the International Monetary Fund, the European Central Bank and the European Union. The accord, granting two extra years to implement measures linked to the island’s bailout, will be discussed at a euro working group meeting of finance officials on April 4.

The MSCI Asia Pacific Index, the benchmark regional equities gauge, yesterday traded at 13.3 times average estimated earnings compared with 14.2 for the Standard & Poor’s 500 Index (SPX) and 12.7 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

A two-day Bank of Japan policy meeting begins today, the first under the leadership of Haruhiko Kuroda as governor. Kuroda, who said yesterday that bold action is necessary to meet expectations, has indicated that expanded purchases of government bonds will be the main tool for monetary easing.

Futures on the Standard & Poor’s 500 Index gained 0.1 percent. The measure climbed 0.5 percent yesterday after the Commerce Department report showed a 3 percent gain in factory orders and Italian and Spanish bond yields declined.

The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S. climbed 0.7 percent in New York yesterday.

Gold tumbled 1.6 percent yesterday, the most in at least a month, as a stronger dollar trimmed demand for the precious metal as an alternative investment.

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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