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Asian Stocks Rise for Fifth Day on Fed Rate Optimism; Mining Shares Gain

by on April 6, 2010

By Kana Nishizawa and Kotaro Tsunetomi April 7 (Bloomberg) — Asian stocks gained, driving the MSCI Asia Pacific Index higher for the fifth straight day, as investors bet the Federal Reserve will leave the benchmark U.S. interest rate at a record low. Rio Tinto Group , the world’s third-largest mining company, rose 0.7 percent in Sydney after oil and metal prices advanced. Sumitomo Corp., which trades commodities, rose 0.8 percent in Tokyo. China Construction Bank Corp. may be active in Hong Kong after people familiar with the matter said the company plans to sell shares to raise capital. The MSCI Asia Pacific Index rose 0.3 percent to 127.75 as of 9:26 a.m. in Tokyo. The gauge has climbed 12 percent from this year’s low on Feb. 8 as improving economic data and a Fed pledge to keep borrowing costs down eased concern that budget deficits in Europe will derail the global economic recovery. “The global economy is on a recovery trend,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. “The market is moving toward summer. The winter is over.” The Nikkei 225 Stock Average rose 0.2 percent. Australia’s S&P/ASX 200 Index climbed 0.2 percent. New Zealand’s NZX 50 Index gained 0.1 percent. Futures on the Standard & Poor’s 500 Index lost 0.2 percent. The gauge advanced 0.2 percent in New York yesterday, as minutes from the last Fed policy meeting showed some central- bank officials warned of raising rates too soon. “While recent data pointed to a noticeable pickup in the pace of consumer spending during the first quarter, participants agreed that household spending going forward was likely to remain constrained by weak labor market conditions, lower housing wealth, tight credit, and modest income growth,” minutes of the March 16 Federal Open Market Committee showed. Shares in the MSCI Asia Pacific Index are priced at an average 16.7 times estimated earnings, compared with 15.3 times for the U.S. S&P 500. To contact the reporters for this story: Kana Nishizawa in Tokyo at knishizawa5@bloomberg.net ； Kotaro Tsunetomi in Tokyo at ktsunetomi@bloomberg.net .

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Japanese Stocks Advance for Second Day on U.S. Manufacturing, Commodities

by on January 4, 2010

By Kana Nishizawa and Satoshi Kawano Jan. 5 (Bloomberg) — Japanese stocks rose for a second day, led by electronics companies and automakers, after U.S. manufacturing climbed more than estimated and commodity prices gained. Toyota Motor Corp. , the world’s biggest carmaker and which gets 31 percent of its revenue in North America, advanced 0.8 percent. Sony Corp., Japan’s biggest exporter of televisions, rose 1.5 percent. Inpex Corp., Japan’s biggest oil explorer, added 2.4 percent after oil prices jumped. “We can see from the positive U.S. economic data and rising commodity prices that there is a strong anticipation of a global self-sustaining recovery,” said Fumiyuki Nakanishi , a strategist at Tokyo-based SMBC Friend Securities Co. Japan’s Nikkei 225 rose 1.1 percent to 10,771.78 as of 9:07 a.m. in Tokyo, headed for its highest close since October 2008. The broader Topix index climbed 1.1 percent to 925.65, with about six stocks rising for each that fell. The Topix climbed 5.6 percent last year, the lowest return among benchmark indexes for the world’s 40 largest stock markets. Stocks in the gauge are valued at an average of 23 times estimated earnings, compared with 18 times for the Standard & Poor’s 500 Index in the U.S. and 13 times for the Dow Jones Stoxx 600 Index in Europe. The S&P 500 added 1.6 percent in New York yesterday after U.S. manufacturing expanded in December at the fastest pace in more than three years. The Institute for Supply Management’s factory index rose to 55.9, the highest level since April 2006, according to the Tempe, Arizona-based group. The median forecast by economists was 54.3. Readings greater than 50 signal expansion. To contact the reporters for this story: Kana Nishizawa in Tokyo at knishizawa5@bloomberg.net ; Satoshi Kawano in Tokyo at skawano1@bloomberg.net .

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Japan Air’s Fourth State Bailout to Be Decided in 2010 After Panel Review

November 9, 2009

By Chris Cooper and Kiyotaka Matsuda Nov. 10 (Bloomberg) — Japan Airlines Corp. ’s application for financing from a state-affiliated fund won’t be decided upon before next year, the lender’s president said, prolonging the carrier’s bid to avoid collapse. “Due diligence won’t be quick,” Hiroshige Nishizawa , president of Enterprise Turnaround Initiative Corp. of Japan, said in an interview in Tokyo yesterday. “We’re not going to be able to make a decision on whether to provide aid by the end of this year.” The group will also draw up a new plan for the carrier, instead of relying on one completed by a government-appointed taskforce last month, Nishizawa said. JAL is seeking state support as it heads for its fourth loss in five years on plunging international travel. The due-diligence team will be decided upon “soon,” said Nishizawa, a former head of Tokyo Tomin Bank Ltd. Enterprise Turnaround was set up last month by the government and private companies with 1.6 trillion yen ($18 billion) to help restructure companies and buy assets. JAL fell 2.8 percent to 106 yen in Tokyo trading yesterday. The stock has slumped 50 percent this year, the biggest decliner in the Nikkei 225 Stock Average. The government created a taskforce to develop a plan for JAL after the transport minister said President Haruka Nishimatsu’s proposal to cut 6,800 jobs and slash routes didn’t go far enough. The carrier , predicting a loss of 63 billion yen this fiscal year, is due to announce first-half earnings on Nov. 13. To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net ; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net

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Most Japanese Stocks Gain After Honda Boosts Profit Forecast; Sony Falls

October 27, 2009

By Kana Nishizawa and Toshiro Hasegawa Oct. 28 (Bloomberg) — Most Japanese stocks rose after Honda Motor Co. tripled its profit forecast. Electronics makers declined after U.S. consumer confidence dropped and the yen strengthened. Honda Motor Co., Japan’s second-largest carmaker, jumped 4.8 percent. Sony Corp., the maker of the PlayStation 3 game console, fell 1.3 percent. Canon Inc. , the world’s largest camera maker, dropped 3.1 percent after reporting a seventh- straight quarterly profit decline. “There’s no local reason to be buying Japanese stocks, while the consumer-related companies have started a retreat in the all-important U.S. market, and that’s likely to resonate here as well,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. The Topix Index rose 0.1 percent to 896.21 as of 9:10 a.m. in Tokyo, with about 11 stocks advancing for 10 that declined. The Nikkei 225 Stock Average fell 0.2 percent to 10,196.56. The yen strengthened to as high as 91.61 per dollar, compared with 92.12 at the close of stock trading in Tokyo yesterday. Against the euro, Japan’s currency appreciated to the highest level in a week. The stronger yen reduces income at Japanese companies when overseas revenue is converted into their home currency. In New York yesterday, the Standard & Poor’s 500 Index dropped 0.3 percent. Consumer confidence unexpectedly fell for a second month in October, reinforcing the views of Federal Reserve policy makers who say household spending will be restrained by rising unemployment. To contact the reporter on the story: Kana Nishizawa in Tokyo at knishizawa5@bloomberg.net ; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net .

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