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Asia Stocks Rally, Bond Risk Falls as Europe Debt Concern Eases; Won Gains

by on May 12, 2010

By Jim Poole and Shani Raja May 13 (Bloomberg) — Asia stocks rallied, led by technology shares, and regional bond risk declined as concerns about European budget deficits waned. The won strengthened for the first time in three days on a brighter Korean export outlook. The MSCI Asia Pacific Index advanced 1.2 percent to 120.18 at 12:05 p.m. in Tokyo, with six shares rising for each one that declined. Standard & Poor’s Index futures were little changed after the U.S. benchmark gained 1.4 percent yesterday. The cost of protecting Asia bonds from default fell to the lowest level since May 3. The won rose 1 percent against the dollar. Technology stocks surged after IBM Corp. projected higher profit and revenue goals, and Cisco Systems Inc.’s earnings exceeded estimates, indicating companies are spending more as the global economy recovers. Investors are more sanguine about the European Union’s debt crisis after Spain unveiled the biggest round of budget cuts in 30 years. “The underlying message from the economy and corporate earnings is that we’re on the recovery path,” said Prasad Patkar , who helps manage $1.7 billion in Sydney at Platypus Asset Management Ltd. Europe’s “decisive action” signals “the recovery won’t get cut short,” he said. Asian stocks climbed after earnings from Tokyo Electron Ltd. to Elpida Memory Inc. boosted confidence. Tokyo Electron, the world’s second-largest maker of semiconductor equipment, jumped 5.6 percent after forecasting a return to profit. Elpida, the world’s No. 3 maker of memory chips, gained 3.1 percent in Tokyo after reporting its first profit since 2007. Samsung, Hyundai South Korea’s Kospi Index leapt 1.7 percent, leading all Asia benchmarks. Samsung Electronics Co., Asia’s biggest chipmaker, rose 3.2 percent in Seoul. Hyundai Motor Co. , South Korea’s largest automaker, climbed 5.2 percent to a record after Goldman Sachs Group Inc. raised its rating on the stock. The won strengthened as signs the global economy is improving brightened the outlook for exports and spurred demand for emerging-market assets. The U.S. posted its biggest trade deficit in more than a year as imports climbed faster than exports. Europe’s gross domestic product expanded at a faster pace than economists forecast, a separate report showed. The won rose 1 percent to 1,131.40 per dollar. “Risk appetite is coming back slightly,” said Minori Uchida , senior analyst in Tokyo at Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s largest bank. “The U.S. data is very good news, not just for South Korea but for the Asian countries. But risk aversion is still alive.” Aussie Gains The Australian dollar extended gains after a government report showed that employers added 33,700 jobs in April, a second month of increases. The currency traded at 89.82 U.S. cents in Sydney from 89.57 cents before the data and 89.36 cents yesterday in New York. The yen dropped against 12 of its 16 major counterparts before a report forecast to show unemployment claims in the U.S. fell. The euro reversed a two-day loss against the dollar as demand rose at a Portuguese debt auction and Spain announced budget cuts. The New Zealand dollar gained as manufacturing industry expanded at the fastest pace in more than five years. Japan’s currency fell to 117.87 per euro in Tokyo from 117.62 in New York yesterday. The yen was at 93.17 per dollar from 93.24. The euro rose to $1.2650 from $1.2614. It fell to $1.2529 on May 6, the weakest level since March 5, 2009. The cost of protecting Asia-Pacific bonds from non-payment dropped, according to traders of credit-default swaps. The Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan fell 5 basis points to 105 basis points in Singapore, Royal Bank of Scotland Group Plc prices show. The risk benchmark is heading for its lowest since May 3, according to CMA DataVision New York prices. To contact the reporters for this story: James Poole in Singapore jpoole4@bloomberg.net ; Shani Raja in Sydney at sraja4@bloomberg.net .

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Asia Stocks Rally, Bond Risk Falls as Europe Debt Concern Eases; Won Gains

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Stocks, Futures Decline on China Speculation; Euro Weakens on Debt Crisis

by on May 12, 2010

By Will McSheehy and Shani Raja May 12 (Bloomberg) — Asia stocks fell for the seventh time in eight days on speculation China will act to cut inflation and after the Wall Street Journal said Morgan Stanley is being investigated. The euro weakened on concern Europe’s debt crisis isn’t over. The MSCI Asia Pacific Index declined 0.2 percent to 118.65 as of 3:40 p.m. in Tokyo, Standard & Poor’s 500 Index futures fell 0.6 percent and Euro Stoxx 50 futures slid 1.3 percent. The euro declined against the yen and dollar. Gold for immediate delivery traded as high as a record $1,234.93 per ounce. “Weighing against any upward momentum is persistent uncertainty regarding the European rescue package and doubts about the rate of economic growth in China,” said Tim Schroeders , who helps manage $1.1 billion at Pengana Capital Ltd. in Melbourne. U.S. stocks fell yesterday after Federal Reserve Chairman Ben S. Bernanke told senators that European finance ministers’ almost $1 trillion aid package isn’t a cure-all for the euro region’s debt crisis. China shares followed, extending losses after entering a bear market yesterday, on concern the state will raise borrowing costs and unveil more measures to cool a housing market in which prices rose at a record pace last month. Morgan Stanley is being probed by U.S federal prosecutors over allegations it misled investors about mortgage derivatives, the Wall Street Journal reported, citing people familiar with the matter that it didn’t identify. Morgan Stanley spokesman Nick Footitt said the bank hasn’t been contacted by the Justice Department about transactions described in the Journal’s report. Japanese Banks Mitsubishi UFJ Financial Group Inc., which holds about 20 percent of Morgan Stanley, dropped 2.4 percent in Tokyo and Mizuho Financial Group Inc. fell 1.2 percent as the Nikkei 225 sank 0.2 percent to 10,394.03 at the 3 p.m. close in Tokyo. The MSCI Emerging Markets Index fell 0.5 percent to 953.93 as of 1:15 p.m. in Singapore, adding to yesterday’s 0.9 percent retreat. China’s Shanghai Composite Index fell 1.4 percent, extending its drop from the Nov. 23 peak to 22 percent. China Overseas Land & Investment Ltd., a developer controlled by the Chinese construction ministry, fell 2.7 percent. PetroChina Co. and Jiangxi Copper Co. tracked a decline in crude oil and copper prices. “China’s economy is growing too fast,” Yonghao Pu , UBS Wealth Management’s chief investment strategist for Asia Pacific, said in a Bloomberg Television interview. “If inflation further edges up, I’m sure the government will further tighten monetary policy, including raising interest rates.” Gains Erased Stocks erased earlier gains made after Toyota Motor Corp., the world’s largest carmaker, forecast net income will rise 48 percent this year on recovering U.S. sales and Commonwealth Bank of Australia said fiscal first-quarter earnings climbed 30 percent as charges for soured loans fell. The euro weakened for a second day against the dollar and the yen on concern Europe’s most-indebted nations will struggle to contain their deficits, slowing the economic recovery. The euro declined to $1.2639 as of 6:46 a.m. in London from $1.2662 in New York yesterday. The yen rose to 117.03 per euro from 117.32 and traded at 92.63 per dollar from 92.65. “As markets began to find faults with the loan package, it’s become clear that this will not solve the roots of the crisis,” said Tsutomu Soma , a bond and currency dealer at Okasan Securities Co. in Tokyo. “Investors are finding fewer reasons to buy the euro.” Gold climbed to a record for a second day, with bullion for immediate delivery rising to an all-time high of $1,234.93 an ounce before trading at $1,233.55 an ounce at 1:29 p.m. in Singapore. The metal has climbed 12 percent in 2010 and is heading for its 10th consecutive annual gain. “All we can do is to put our money into real assets because paper money everywhere is being debased,” Jim Rogers , Singapore-based chairman of Rogers Holdings, told Bloomberg Television today. To contact the reporters on this story: Will McSheehy in Sydney at wmcsheehy@bloomberg.net Shani Raja in Sydney at sraja4@bloomberg.net .

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Stocks, Futures Decline on China Speculation; Euro Weakens on Debt Crisis

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Asia Stocks Rise on Toyota, Newcrest Profit; Euro Falls on Debt Concerns

May 11, 2010

By Will McSheehy and Shani Raja May 12 (Bloomberg) — Asian stocks rose, led by carmakers and gold producers, after Toyota Motor Corp. and Newcrest Mining Ltd. forecast higher earnings. Bullion traded near a record and the euro weakened on concern Europe’s debt crisis isn’t over. The MSCI Asia Pacific Index rose 0.2 percent to 119.10 as of 12:30 p.m. in Tokyo, with three times as many stocks advancing as declining. Standard & Poor’s 500 Index futures dropped 0.2 percent and the euro fell against 10 of 16 major counterparts. Gold for immediate delivery declined 0.4 percent to $1,227.57 an ounce after hitting a record $1,234.50 yesterday. “The flow of earnings-related news is on balance proving a positive catalyst for the market,” said Tim Schroeders , who helps manage $1.1 billion at Pengana Capital Ltd. in Melbourne. “Weighing against any upward momentum is persistent uncertainty regarding the European rescue package and doubts about the rate of economic growth in China.” Toyota, the world’s largest carmaker, today forecast net income will rise 48 percent this year on recovering U.S. sales while Commonwealth Bank of Australia said fiscal first-quarter earnings climbed 30 percent as charges for soured loans fell in an improving economy. U.S. stocks fell yesterday after Federal Reserve Chairman Ben S. Bernanke told senators that European finance ministers’ almost $1 trillion aid package isn’t a cure- all for the euro region’s debt crisis. China Stocks China’s Shanghai Composite Index fell 0.9 percent to 2,624.90 following from a 1.9 percent drop yesterday that pushed losses from a November peak to more than 20 percent, the definition of a so-called bear market. The slide came on concern the government will raise borrowing costs to combat inflation and unveil more measures to curb soaring housing prices. Toyota climbed 2.6 percent to 3,585 yen, its biggest gain in two weeks, while Isuzu Motors Ltd ., Japan’s largest maker of light-duty trucks, gained 6 percent to 301 yen after forecasting net income will more than double. Newcrest and Lihir Gold Ltd., Australia’s top gold producers, rose more than 3.3 percent in Sydney as the S&P/ASX 200 Index gained 0.6 percent, the steepest increase among all Asia-Pacific equity benchmarks. Samsung Life Insurance Co., South Korea’s largest life insurer, rose on its first day of trading in Seoul after completing the country’s biggest initial public offering. The stock, rated “buy” at Hyundai Securities Co. today, climbed 4.6 percent. Bond Risk The cost of insuring Asia-Pacific bonds from non-payment declined, according to traders of credit-default swaps. The Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan dropped 6 basis points to 110 basis points, Royal Bank of Scotland Group Plc prices show. The Markit iTraxx Japan index fell 5.5 basis points to 110.5, according to Morgan Stanley. The Australian dollar rose against 10 of its 16 most-traded counterparts before a report that economists said will show employers added jobs for the seventh time in the last eight months. “I’d rather own Asian currencies than Western currencies for the most part because the creditor nations in the world are all in Asia,” investor Jim Rogers said in a Bloomberg Television interview. “Most Asian nations have saved up for a rainy day and now it’s raining and they’ve got assets to help themselves so I’d rather be here than in the West.” The euro traded at $1.2637 in Tokyo from $1.2662 in New York yesterday before a German report that may show the rebound in Europe’s largest economy stalled for a second quarter. The currency declined to $1.2529 on May 6, the weakest since April 2009. Fiscal Workout “Each nation in the euro zone still has to work on rebuilding its finances,” said Nobuaki Kubo , vice president of foreign exchange in Tokyo at BBH Investment Services Inc. Crude oil declined for a second day, dropping 0.7 percent to $75.84 a barrel in New York. “There’s some skepticism about the ultimate effectiveness of the European Union bailout package,” Toby Hassall , commodity analyst at CWA Global Markets Pty in Sydney, said in a telephone interview. “Sovereign debt concerns raise concern about the prospects of a recovery in Europe and globally, and therefore fuel demand.” To contact the reporters on this story: Will McSheehy in Sydney at wmcsheehy@bloomberg.net Shani Raja in Sydney at sraja4@bloomberg.net .

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Barton Biggs Says U.S. Stocks May Advance 20% as Global Economy Rebounds

May 10, 2010

By Shani Raja and Susan Li May 11 (Bloomberg) — U.S. stocks could jump as much as 20 percent, led by technology companies, as the global economy rebounds from Europe’s debt crisis, said Barton Biggs . “I’m betting the next move in the U.S. market is going to be up 15 to 20 percent,” Biggs, who runs New York-based hedge fund Traxis Partners LP and whose flagship fund returned three times the industry average last year, said in a Bloomberg Television interview today. “I would just point out that the world is having a strong economic recovery , and so is Europe.” Biggs recommended buying U.S. stocks last year when benchmark indexes sank to the lowest levels since the 1990s. He did not give a timeframe or refer to any specific stock index in his comments today. Futures on the Standard & Poor’s 500 Index lost 0.1 percent to 1,155.10 as of 11:56 a.m. in Tokyo. The stock gauge climbed 4.4 percent yesterday, the most in more than a year, after European policy makers announced an almost $1 trillion loan package to contain the region’s sovereign-debt crisis. The S&P 500’s advance followed an 8.7 percent slide since April 23 — and the biggest weekly retreat since the start of the bull market in March 2009 — on concern Europe’s leaders weren’t doing enough to avert the threat to global credit markets. An index of the S&P 500 Index’s computer hardware companies was the biggest contributor to yesterday’s advance. “There are plenty of opportunities in the U.S.,” Biggs said, adding that shares in drug developers look cheap and that property companies are also attractive. “It’s by no means a foregone conclusion that we have a crisis every three years and, my God, that the world is coming to an end. I don’t believe that’s what’s happening at all.” ‘Severe Tensions’ Governments of the 16-euro nations agreed May 9 to lend as much as 750 billion euros ($958 billion) to the most-indebted countries to resolve the region’s debt crisis, while the European Central Bank said it will counter “severe tensions” in “certain” markets by purchasing government and private debt. Europe’s debt problems illustrated the need for nations in the region to evolve towards a federal system of government capable of enforcing more “discipline” on countries, said Biggs. “In the long run, Europe will have to become similar to the United States,” he said. To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Most Asian Stocks Rise as China Earnings Boost Recovery Hopes; ANZ Falls

April 28, 2010

By Shani Raja April 29 (Bloomberg) — Most Asian stocks rose, led by consumer-related companies, as reports of increased earnings in China overshadowed a downgrade of Spain’s debt rating. Suning Appliance Co. climbed 3.1 percent in Shenzhen, south China, after saying first-quarter profit increased 86 percent from a year earlier. China Merchants Bank Co. gained 2.6 percent in Shanghai after first-quarter profit rose 40 percent. Australia & New Zealand Banking Group Ltd. sank 1.4 percent in Sydney as its chief executive officer voiced concern over Europe’s debt problems. Twelve stocks advanced for every 11 that fell on the MSCI Asia Pacific excluding Japan Index , which lost 0.2 percent to 423.34 as of 10:09 a.m. in Hong Kong. Japanese markets are closed today for a national holiday. China’s Shanghai Composite Index gained 0.6 percent. South Korea’s Kospi index sank 0.4 percent and Australia’s S&P/ASX 200 Index dropped 0.8 percent. “Concern surrounding European sovereign debt is limiting gains,” said Tim Schroeders , who helps manage about $1.1 billion at Pengana Capital Ltd. in Melbourne. “Investors are grappling with the sustainability of improved earnings and the impact on long-term stock valuations.” New Zealand’s NZX 50 Index was little changed. Central bank Governor Alan Bollard said he may raise the benchmark interest rate from a record low as early as June as improving global demand buoys exports and underpins an economic recovery. Futures on the Standard & Poor’s 500 Index lost 0.1 percent. The index advanced 0.7 percent yesterday, rebounding from the biggest drop since February, after profits at Dow Chemical Co., the largest U.S. chemical maker, and insulation producer Owens Corning Inc. topped average analyst forecasts. Banks led the S&P 500’s advance after the Federal Reserve said it will keep its benchmark interest rate near zero for an extended period, even as the labor market begins to improve. The gauge earlier fell as much as 0.2 percent after S&P cut Spain to AA from AA+, which followed downgrades the previous day on Greece and Portugal. “The Fed pledge to maintain low interest rates along with better than expected U.S. earnings releases should be supportive of improved investor sentiment,” said Schroeders. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net

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Singapore Dollar Surges, Asian Stocks Climb as Global Growth Accelerates

April 13, 2010

By Shani Raja April 14 (Bloomberg) — The Singapore dollar strengthened the most in 10 months against the U.S. currency and South Korea’s won jumped after government reports showed accelerating economic growth. Technology shares led a rally in Asian stocks after Intel Corp. ’s sales forecast beat analysts’ estimates. The Monetary Authority of Singapore revalued its currency, sending it 0.9 percent higher against the dollar to 1.3798 as the government said the economy will expand as much as 9 percent this year. The won jumped 0.6 percent versus the dollar. The MSCI Asia Pacific Index gained 0.5 percent to 128.07 at 11:50 a.m. in Tokyo, and futures on the Standard & Poor’s 500 Index increased 0.2 percent. Intel shares rose as much as 3.6 percent in extended trading after the New York close. Accelerating growth in Singapore and the biggest drop in Korean unemployment in a decade underscored Asia’s leadership in the global recovery. Economists surveyed by Bloomberg News estimated China’s economy probably grew 11.7 percent in the first quarter, the fastest pace in almost three years. Intel’s forecast increased optimism as the U.S. earnings season starts. “Companies are demonstrating that economic conditions are improving, while the data is still pointing to an ongoing theme of recovery,” said Prasad Patkar , who helps oversee $1.9 billion at Platypus Asset Management Ltd. in Sydney. “You now need to watch the underlying performance of the global economy once all the stimulus has washed through.” Equities Gain Singapore’s benchmark Straits Times Index advanced to a 22- month high, rising as much 0.9 percent to 2,998.64. The city- state’s $182 billion economy rose an annualized 32.1 percent from the previous three months in the first quarter after shrinking 2.8 percent from October to December. DBS Group Holdings Ltd. , Southeast Asia’s biggest lender, climbed 2.8 percent. South Korea’s Kospi stock index rose 0.9 percent after the nation’s unemployment rate declined by the most in 10 years in March. KB Financial Group Inc. gained 3.6 percent and Shinhan Financial Group Co. added 2.7 percent. Samsung Electronics Co. , the world’s largest computer-memory chipmaker, climbed 1.6 percent after Intel ’s second-quarter sales forecast for revenue of $10.2 billion, plus or minus $400 million. Analysts had estimated $9.72 billion, according to a Bloomberg survey. Copper futures on the London Metal Exchange gained as much as 0.9 percent to $7,968 a metric ton, and traded at $7,944 in Asia. Aluminum rose as much as 0.4 percent to $2,445 a ton. Yen Weakens The yen weakened for a fifth day against the euro, the longest losing streak in three months, as signs the global economy is recovering boosted demand for riskier assets. “Risk appetite is improving, buoyed by solid economic data and corporate profits,” said Norihiro Tsuruta , chief strategist in Tokyo at Shinko Research Institute Ltd. ’’This will encourage a fund allocation shift away from the yen.’’ The Japanese currency fell against 15 of its 16 most-traded counterparts, declining 0.4 percent to 127.31 per euro. Europe’s single currency strengthened to $1.365 in Tokyo from $1.3614 in New York yesterday. New Zealand’s dollar weakened against all major peers as a government report today showed retail sales unexpectedly dropped in February, adding to signs the central bank will keep interest rates at a record low to sustain the economic recovery. New Zealand’s dollar fell 0.3 percent to 71.14 U.S. cents and 0.3 percent to 66.35 yen. Declining Risk The cost of protecting Japanese corporate bonds from default was on course to fall to its lowest level since June 2008, with the Markit iTraxx Japan index dropping 2 basis points to 85 basis points, according to Deutsche Bank AG and CMA DataVision in New York. Indicators of corporate credit risk also fell in Australia and Asia. Investors use the default-swap indexes to hedge against losses on corporate debt or speculate on creditworthiness, and the swaps typically fall as investor confidence increases. The Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan dropped 1 basis point to 89.5 basis points, while the Markit iTraxx Australia index fell 2 basis points to 77.5 basis points, Deutsche Bank prices show. A basis point is 0.01 percentage point. Crude oil pared losses and traded near $84 a barrel in New York, snapping five days of declines. The contract for May delivery was at $84.32 a barrel, up 27 cents, in electronic trading on the New York Mercantile Exchange. It earlier fell as much as 34 cents. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net

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Asian Stocks Climb on Improving Demand Outlook; Rio Tinto Gains on Rates

March 23, 2010

By Shani Raja and Toshiro Hasegawa March 24 (Bloomberg) — Asian stocks rose, led by mining and technology companies, as signs of growing demand for semiconductors and iron ore boosted confidence in the strength of the global economic recovery. Advantest Corp. , the world’s largest maker of memory-chip testers, climbed 1.5 percent in Tokyo, pacing gains among technology firms following advances by U.S. peers. Rio Tinto Group , the world’s third-biggest mining company, gained 2 percent in Sydney after a newspaper reported that Brazil’s Vale SA had raised rates on some types of iron ore. Canon Inc. , the world’s largest camera maker, rose 2.6 percent. “Global demand is increasing, especially for cyclical sectors, as economies head toward a recovery,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. “There are growing expectations for corporate performance to recover next fiscal year.” The MSCI Asia Pacific Index rose 0.5 percent to 125.05 as of 9:55 a.m. in Tokyo. The gauge has climbed 9.5 percent from a more-than-two-month low on Feb. 8. Japan’s Nikkei 225 Stock Average climbed 0.8 percent as the government reported export growth accelerated in February. South Korea’s Kospi index advanced 0.3 percent, while Australia’s S&P/ASX 200 Index climbed 0.7 percent. Futures on the Standard & Poor’s 500 Index were little changed. The gauge rose 0.7 percent yesterday. Cliffs Natural Resources Inc. led a rally in steel companies after Valor Economico reported Vale more than doubled rates on some types of ore. Intel Corp. gained after the Economic Daily News reported Taiwan Semiconductor Manufacturing Co. lifted its forecast for 2010 global output. The MSCI Asia Pacific Index rose 1.4 percent last week after the U.S. Federal Reserve pledged to keep borrowing costs near zero for an “extended period” and as the Bank of Japan expanded a bank-loan program. Companies in the gauge trade at 18.8 times estimated earnings, compared with 15.1 times for the S&P 500. To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net . Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net .

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Asian Stocks Drop the Most in a Week on Concern Over Stimulus, Inflation

March 21, 2010

By Shani Raja March 22 (Bloomberg) — Asian stocks fell the most in a week after an International Monetary Fund official said advanced economies will struggle to tackle public debt, and on concern central banks in Asia will step up efforts to curb inflation. BHP Billiton Ltd. , the world’s largest mining company, fell 1.5 percent in Sydney as commodity prices slumped after India’s central bank unexpectedly raised interest rates last week. Rio Tinto Group, the third-biggest, dropped 1.3 percent. Newcrest Mining Ltd. lost 1.3 percent in Sydney after gold prices tumbled the most in six weeks in New York on March 19. Posco, Asia’s biggest maker of stainless steel, sank 2.6 percent in Seoul on speculation global demand will slow. “Investors are increasingly jittery about the inflationary outlook and high levels of sovereign debt,” said Tim Schroeders , who helps manage about $1.1 billion at Pengana Capital Ltd. in Melbourne. “The IMF’s comments switch the spotlight to a medium-term limitation of the global economy.” The MSCI Asia Pacific ex Japan Index fell 1.2 percent to 416.39 as of 11:07 a.m. in Tokyo, with five times as many stocks declining as advancing. The gauge gained 1.3 percent last week after the U.S. Federal Reserve pledged to keep borrowing costs near zero for an “extended period” and as the Bank of Japan expanded a bank-loan program. Japan’s markets are closed today for a holiday. South Korea’s Kospi Index lost 1 percent, the biggest drop among Asia- Pacific equity benchmarks. Australia’s S&P/ASX 200 Index retreated 0.7 percent and China’s Shanghai Composite Index rose 0.3 percent. Rate Surprise Futures on the Standard & Poor’s 500 Index fell 0.7 percent. The gauge also declined 0.5 percent on March 19 as India’s surprise rate decision that day spurred speculation that withdrawals of economic stimulus will curtail global growth. India’s central bank raised interest rates for the first time in almost two years, saying that controlling price-gains was imperative after inflation accelerated to a 16-month high. “India raising rates is seen as a precursor to other big- spending economies tightening fiscal measures, and we know how traders will react to that,” said Chris Weston , a Melbourne- based research analyst at IG Markets. “The narrative from the IMF shows it’s going to be a bumpy ride for 2010, but the potential pullback should also entice some fresh investment opportunities.” Advanced economies face “acute” challenges in tackling high public debt, and unwinding existing stimulus measures won’t come close to bringing deficits back to prudent levels, John Lipsky , first deputy managing director of the International Monetary Fund, said in a speech yesterday at the China Development Forum in Beijing. Materials-related companies fell the most among the 10 industry groups in the MSCI Asia Pacific ex Japan Index. Crude oil retreated the most in three weeks in New York on March 19, slumping 1.9 percent to settle at $80.68 a barrel, while copper futures for May delivery dropped 0.7 percent to $3.3725 a pound. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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BTIG Hires Goldman’s Jesse Lentchner to Drive Expansion in Asia-Pacific

March 17, 2010

By Shani Raja March 18 (Bloomberg) — BTIG LLC hired Jesse H. Lentchner , who spent more than a decade at Goldman Sachs Group Inc. in Asia, as chief executive officer of its Asia-Pacific operations. Lentchner will join BTIG’s Hong Kong office in June, the brokerage’s Hong Kong office said today in an e-mailed statement. He will drive the firm’s expansion in Asia with a special focus on Hong Kong, Singapore, Japan and Australia. “Jesse is a significant and pivotal hire,” Kevin Chessen , head of international trading at BTIG, said in the statement. “His diverse global experience running large sophisticated businesses will give us a meaningful edge as we continue to expand our footprint.” To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Fluctuate as Oil Price, Shipping Rates Drop; Telstra Advances

March 9, 2010

By Shani Raja and Satoshi Kawano March 10 (Bloomberg) — Asian stocks fluctuated as shipping lines declined after a measure of cargo-transport-rates fell, while Australia’s largest telephone company rose on speculation it will avoid a forced break-up. STX Pan Ocean Co., South Korea’s largest bulk-shipping line, dropped 1.9 percent in Seoul, and Kawasaki Kisen Kaisha Ltd., Japan’s third-largest line, fell 1.7 percent in Tokyo after shipping rates fell for the first time in almost two weeks. BHP Billiton Ltd. , Australia’s largest oil producer, lost 0.9 percent as crude oil futures declined for a second day. Telstra Corp. climbed 2.1 percent in Sydney after a newspaper said Australia’s government may fail to force it to split. “We don’t have a strong catalyst, so I’m expecting stocks to drift without a clear direction today,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. The MSCI Asia Pacific Index was little changed at 122.73 as of 10:26 a.m. in Tokyo, with about as many stocks advancing as declining. The index has risen 74 percent since March 9 last year, when it sank to its lowest level since the September 2008 bankruptcy filing of Lehman Brothers Holdings Inc. Japan’s Nikkei 225 Stock Average was little changed at 10,551.54, and no major benchmark in the Asia-Pacific region moved more than 0.6 percent. The MSCI Asia Pacific Index has risen in the past year as governments worldwide bolstered their economies through increased spending. Shares in the gauge trade at 18.6 times estimated earnings on average, compared with 15 times for the Standard & Poor’s 500 Index in the U.S. and 13 times for the Stoxx Europe 600 Index. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net ; Satoshi Kawano in Tokyo skawano1@bloomberg.net .

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Asian Stocks Rise on U.S. Jobs, Bank of Japan Speculation; Billabong Gains

March 4, 2010

By Shani Raja and Toshiro Hasegawa March 5 (Bloomberg) — Asian stocks rose for the fourth time in five days after U.S. jobless claims fell and the Nikkei newspaper reported that the Bank of Japan may further loosen monetary policy. Billabong International Ltd. , a surfwear maker that gets 44 percent of its revenue from the Americas, climbed 2.9 percent in Sydney. Sony Corp. , the maker of the PlayStation 3 game machine, rose 2.7 percent as a weaker yen boosted the outlook for export earnings. STX Pan Ocean Co. and Korea Line Corp., South Korea’s biggest bulk-shipping lines, advanced more than 2 percent in Seoul after an index of freight rates rose the most since July. The U.S. economy is “steadily recovering,” said Juichi Wako , a senior strategist at Tokyo-based Nomura Holdings Inc. “If implemented, the BOJ’s measures may widen a gap in the U.S.’s and Japan’s borrowing costs and halt a further appreciation of the yen.” The MSCI Asia Pacific Index advanced 0.7 percent to 120.51 as of 9:46 a.m. in Tokyo. The gauge has fallen 4.9 percent from a 17-month high on Jan. 15 on concern over budget deficits in Europe and speculation governments around the world will start withdrawing economic stimulus policies. Japan’s Nikkei 225 Stock Average climbed 2 percent and South Korea’s Kospi Index gained 0.7 percent. Australia’s S&P/ASX 200 Index rose 0.5 percent, while New Zealand’s NZX 50 Index lost 0.1 percent, even after the Treasury Department said the nation’s budget cash deficit in the seven months ended Jan. 31 was narrower than forecast. To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net . Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net .

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Asian Shares Fall for First Time in Three Days on U.S. Consumer Confidence

February 23, 2010

By Jonathan Burgos and Shani Raja Feb. 24 (Bloomberg) — Asian stocks declined, dragging down the MSCI Asia Pacific Index for the first time in three days, as U.S. consumer confidence decreased to a 10-month low and as the stronger yen hurt Japanese exporters. Sony Corp., an electronics maker that receives 23 percent of sales from the U.S., retreated 2.4 percent in Tokyo, and Nissan Motor Co., a carmaker that gets 35 percent of revenue in North America, lost 3.1 percent. BHP Billiton Ltd., Australia’s top oil producer and the world’s largest mining company, dropped 1.8 percent after oil and metal prices fell. “The U.S. consumer confidence report has again created nervousness about the fragility of the recovery and its sustainability,” said Nader Naeimi , an investment strategist in Sydney at AMP Capital Investors, which oversees about $90 billion globally. “Nevertheless, the fundamentals remain strong and we are still seeing good earnings coming through.” The MSCI Asia Pacific Index fell 1.1 percent to 117.70 as of 9:15 a.m. in Tokyo, snapping gains of 3.2 percent in the past two days. The gauge has lost 7.2 percent from a 17-month high on Jan. 15 on concern governments will start withdrawing stimulus measures, and that Greece, Spain and Portugal will struggle to curb deficits. Japan’s Nikkei 225 Stock Average dropped 1.7 percent to 10,180.95. Australia’s S&P/ASX 200 Index declined 1.2 percent in Sydney. South Korea’s Kospi Index slipped 1 percent. Futures on the Standard & Poor’s 500 Index fell 0.2 percent. The measure retreated 1.2 percent in New York yesterday after the Conference Board’s confidence index for February decreased to the lowest level since April 2009, a report from the New York-based private research group showed. Confidence, Commodities Decline In addition, the Ifo institute in Munich said its survey of German business confidence unexpectedly fell for the first time in 11 months in February as the coldest winter in 14 years damped retail sales and construction. Crude oil for April delivery lost 1.8 percent in New York yesterday, the steepest decline in two weeks. The London Metal Exchange Index of six metals including copper and zinc dropped for a second day yesterday, slipping 2.3 percent. The dollar weakened to as low as 89.92 yen in Tokyo from 91.08 at the 3 p.m. close of stock trading yesterday. Japanese companies consider an average level of 92.90 as the dividing line between losses and profits, the Cabinet Office said on Feb. 19. To contact the reporters for this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net ; Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Fluctuate as Panasonic Declines, Woodside Rises on Oil Prices

February 7, 2010

By Shani Raja and Anna Kitanaka Feb. 8 (Bloomberg) — Asian stocks fluctuated as Japanese consumer-related companies declined following disappointing earnings, while Australian commodity producers climbed. Panasonic Corp. fell 4.9 percent in Tokyo after the electronics maker had a loss. Yamaha Motor Co., a motorcycle maker, retreated after reporting a bigger-than-forecast loss. Woodside Petroleum Ltd. , Australia’s second-biggest oil and gas producer, rose as the price of crude oil rallied. The MSCI Asia Pacific Index was little changed at 114.64 as of 9:47 a.m. in Tokyo, with about as many stocks advancing as declining. The gauge has fallen 9.5 percent from a 17-month high on Jan. 15 on concern central banks from China to India will tighten monetary policy to curb inflation. “The market is still pretty nervous,” said Chris Hall , who helps manage $3.3 billion at Argo Investments Ltd. in Adelaide, Australia. Japan’s Nikkei 225 Stock Average was also little changed. Australia’s S&P/ASX 200 Index rose 0.5 percent, as the government said it’s withdrawing guarantees on large deposits and wholesale funding on signs credit markets are recovering from the global financial crisis. New Zealand’s NZX 50 Index fell 0.1 percent in Wellington even as house prices increased for a fourth month in January. The MSCI Asia Pacific Index dropped 1.8 percent last week, a third weekly decline. That cut the average price of stocks in the gauge to 18 times estimated earnings, the lowest level since February 2009, according to data compiled by Bloomberg. S&P 500 On Feb. 5, the Standard & Poor’s 500 Index added 0.3 percent in New York, erasing an early 1.8 percent drop, on speculation the European Union would devise a solution for budget deficits in Greece and Spain. Concluding a meeting of Group of Seven finance ministers in Canada, European officials said they will help ensure Greece tackles the largest budget deficit in the region. French Finance Minister Christine Lagarde told reporters that European nations “have confirmed the substance and significance” of Greece’s plan to reduce the deficit without outside assistance. Crude oil for March delivery rose 0.9 percent today after having lost 7.8 percent in the past three days. Copper futures for March delivery climbed 0.9 percent, the first advance in four days. To contact the reporters for this story: Shani Raja in Sydney at sraja4@bloomberg.net ; Anna Kitanaka in Tokyo at akitanaka@bloomberg.net .

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Asian Stocks Fluctuate as Banks, Carmakers Drop; BHP, Nippon Oil Advance

January 18, 2010

By Anna Kitanaka and Shani Raja Jan. 19 (Bloomberg) — Asian stocks fluctuated as Australian banks and Japanese exporters of cars and electronics fell, while commodity producers rose on oil and metal prices. Commonwealth Bank of Australia, the country’s biggest bank, retreated 1.8 percent in Sydney. Toyota Motor Corp. , the world’s biggest carmaker and which gets about 31 percent of revenue from North America, fell 1 percent in Tokyo after the dollar weakened to its lowest level in almost a month against the yen. Nippon Oil Corp., Japan’s biggest refiner, rose 1.4 percent. The MSCI Asia Pacific Index was little changed at 126.18 at 10:39 a.m. in Tokyo, with about as many stocks advancing as declining. The index climbed 49 percent in the past year through yesterday amid signs of a global recovery. “Markets are pausing for a breath,” said Prasad Patkar , who helps manage about $1.6 billion at Platypus Asset Management in Sydney. “Expected corporate earnings are now factoring in the economic recovery. For markets to press on from here upwards, we’ll need to see the earnings growth come through.” Japan’s Nikkei 225 Stock Average was little changed in Tokyo, and Australia’s S&P/ASX 200 Index dropped 0.8 percent in Sydney. South Korea’s Kospi Index added 0.2 percent in Seoul. The yen strengthened to as much as 90.52 against the dollar today from 91.04 at yesterday’s close of stock trading in Tokyo, eroding overseas income for Japanese companies when converted into their home currency. Crude oil for February delivery rose 0.3 percent in New York yesterday, breaking a five-day losing streak. A gauge of six metals in London, including copper and zinc, added 0.7 percent, while gold for immediate delivery advanced 0.2 percent yesterday. To contact the reporters for this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net ; Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Advance as China Trade Boost Metal Prices; China Shares Climb

January 10, 2010

By Shani Raja and Anna Kitanaka Jan. 11 (Bloomberg) — Asian stocks rose, lifting a benchmark index of the region’s equities for the 13th day in 14, after Chinese trade figures boosted metals prices. BHP Billiton Ltd. , the world’s biggest mining company, gained 1.9 percent as copper rose in after-hours trading in New York. Posco, the steelmaker that is due to report earnings on Jan. 14, jumped 3.1 percent in Seoul after Hyundai Securities Co. raised its share-price estimate. Industrial & Commercial Bank of China Ltd. climbed 3.3 percent after the government approved stock index futures. The MSCI Asia Pacific Index excluding Japan Index added 1.5 percent to 433.82 as of 10:05 a.m. in Hong Kong. Japanese markets are closed today for a holiday. The broader MSCI Asia Pacific Index, which includes Japan, increased 34 percent last year on optimism growth around the region is accelerating. “The whole recovery story is unfolding very well,” said Nader Naeimi , a Sydney-based strategist at AMP Capital Investors, which oversees about $75 billion. “It shows that recovery in China is on track and the fact that export numbers are very strong shows external demand from the developed world is gaining traction as well.” Australia’s S&P/ASX 200 Index rose 0.9 percent, while South Korea’s Kospi Index added 0.5 percent. Taiwan’s Taiex Index increased 0.8 percent. China’s Shanghai Composite Index rose 1.5 percent, the most in two weeks, led by brokerages and banks. The China Securities Regulatory Commission on Jan. 8 cleared an overhaul of trading laws that will permit short sales and stock-index futures, fanning speculation trading volumes will increase. Futures on the Standard & Poor’s 500 Index gained 0.4 percent. The gauge rose 0.3 percent to a 15-month high on Jan. 8 as speculation the Federal Reserve will leave interest rates near zero overshadowed an unexpected decrease in jobs. To contact the reporters for this story: Shani Raja in Tokyo at sraja4@bloomberg.net ; Anna Kitanaka in Tokyo at akitanaka@bloomberg.net .

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Asian Stocks Fluctuate as Commodity Companies Advance, Japanese Banks Fall

December 28, 2009

By Shani Raja Dec. 29 (Bloomberg) — Asian stocks fluctuated as higher oil and metal prices boosted commodity producers, while Japanese banks declined after Sumitomo Mitsui Financial Group Inc. said it’s considering raising capital. BHP Billiton Ltd. , the world’s largest mining company, added 1.3 percent in Sydney. Mitsubishi Corp. , Japan’s biggest commodities trader, gained 1.8 percent in Tokyo. Sumitomo Mitsui led declines by Japanese banks after its president said the company will “fully examine” whether to raise more capital. Pioneer Corp. , the Japanese maker of car stereos, slumped 5 percent after saying it hadn’t decided when to sell new shares. “We’ve got some positive and negative data flow, but on the whole it seems traders are keen to drive prices higher in the short term,” said Chris Weston , an institutional dealer at IG Markets in Melbourne. “There don’t seem to be many sellers out there.” The MSCI Asia Pacific Index was little changed at 120.36 as of 11:30 a.m. in Tokyo, with nine stocks advancing for every seven that fell. The gauge is headed for a 34 percent gain this year, its biggest annual increase since 2003, as central banks worldwide reduced borrowing costs and governments boosted spending to shore up their economies. Japan’s Nikkei 225 Stock Average fell 0.2 percent, while Australia’s S&P/ASX 200 Index climbed 1.1 percent today in Sydney, the steepest increase in the Asia-Pacific region. Commodities Gain Materials companies were the biggest contributors to the MSCI index’s advance. BHP Billiton advanced 1.3 percent to A$43.02. Santos Ltd. , Australia’s No. 3 oil and gas producer, climbed 0.9 percent to A$14.11. Mitsubishi added 1.8 percent to 2,320 yen, set for its highest close since Sept. 29. and Mitsui & Co., Japan’s No. 2 commodity trader, climbed 1.9 percent. Crude oil for February delivery rose to a one-month high in New York yesterday, gaining 0.9 percent, and gold climbed for the third straight session. Copper futures for March delivery advanced to the highest price in more than 15 months on speculation demand will strengthen and drain stockpiles. Newcrest Mining Ltd. , Australia’s largest gold producer, rose 0.5 percent to A$35.32. Also in Sydney, Aquarius Platinum Ltd. , the world’s fourth-biggest producer of the metal, surged 5.1 percent to A$7.36, after platinum yesterday jumped to a three-week high. Futures on the Standard & Poor’s 500 Index added less than 0.1 percent. The index climbed 0.1 percent in New York yesterday as rising metal and oil prices boosted commodity producers. Asia Outperforms The MSCI Asia Pacific Index has surged 71 percent from its lowest in more than five years on March 9, outpacing gains of 67 percent by the S&P 500 and 60 percent for the Dow Jones Stoxx 600 Index in Europe. Stocks in the MSCI Index are valued at an average of 23 times estimated earnings, compared with an average of 18 times for the S&P 500 and 16 for the Stoxx. This year’s gain in Asian stocks is part of a global rally that has boosted the MSCI World Index by 28 percent, on course for its steepest increase since 2003. The gauge plunged 42 percent last year, the most since inception 40 years ago, as mounting losses from the collapse of the U.S. subprime mortgage market and the bankruptcy of Lehman Brothers Holdings Inc. led investors to exit equities. Sumitomo Mitsui Financial dropped 2.6 percent to 2,660 yen. Japan’s second largest bank by market value said it will consider whether to sell more stock after regulators called for tighter capital standards and larger rival Mitsubishi UFJ Financial Group Inc. raised 1 trillion yen ($11 billion). “There are still concerns about banks raising capital,” said Naoki Fujiwara , chief fund manager at Shinkin Asset Management Co., which oversees about $4 billion in Tokyo. ‘Stay Competitive’ “We have to stay competitive,” Sumitomo Mitsui President Teisuke Kitayama said in an interview. “It’s not a case of copying somebody, but we need to fully examine the matter to make sure we’re not slow off the block.” Mitsubishi UFJ declined 1.3 percent to 452 yen. The world’s largest financial companies are shoring up capital after more than $1.7 trillion in losses and writedowns following the collapse of the U.S. subprime-mortgage market and of Lehman Brothers. Also in Tokyo, Pioneer slumped 5 percent to 288 yen. The maker of car-navigation systems and audio equipment said it hasn’t decided when to sell new shares to Honda Motor Co., which plans to buy 2.5 billion yen in stock. Pioneer said it will give an update on the share sale by March. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Sydney, Taiwan Airports Tighten Security After Attempted Detroit Attack

December 26, 2009

By Shani Raja Dec. 26 (Bloomberg) — Sydney Airport and Taiwan terminals stepped up security on flights headed for the U.S. after yesterday’s suspected terrorist attack on a Detroit-bound transatlantic airline carrying 278 passengers. Travelers leaving Sydney on flights to the U.S. will undergo more stringent body and luggage checks at the request of U.S. authorities, an airport spokesman said by telephone. “All passengers on flights to the U.S. will undergo pat- down checks and additional checks on carry-on baggage,” said Michael Samaras, manager for media and communications at the airport. Previously passengers on U.S. flights were subject to “continuous” random checks, he said. Taiwan also imposed an additional security check of passengers and carry-on items at boarding gates for U.S. flights from the island’s international airports, Liu Chang-hui, spokesman for the Aviation Police Office, said. Abdul Mudallad, a Nigerian, is suspected of attempting to blow up Northwest Airlines flight 253 from Amsterdam with an explosive device, according to U.S. officials. U.S. President Barack Obama has called for “all appropriate measures to be taken to increase security” and the Department of Homeland Security said passengers may notice additional screening at airports. Still, some regional airports have not made any changes to security measures. Melbourne airport has not as yet received any specific government directives calling for additional security measures, said Damian Tkalec, a spokesman for Melbourne Airport. Narita International Airport Corp., operator of Japan’s busiest international airport located adjacent to Tokyo, hasn’t stepped up security measures, Masaharu Watanabe, a spokesman for the airport said. Kansai International Airport, Japan’s second- busiest international gateway, also isn’t strengthening security measures, Chika Sakamoto, a spokeswoman for the airport said. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Mining Stocks Rise on Metals; Mitsui O.S.K. Falls on Shipping Rates

December 14, 2009

By Shani Raja Dec. 15 (Bloomberg) — Asian mining stocks rose after copper and platinum prices climbed. Shipping companies paced declines among Japanese equities after cargo rates fell. Platinum Australia Ltd. , which owns mines in South Africa and Australia, surged 4.6 percent in Sydney. BHP Billiton Ltd. , the world’s biggest mining company, climbed 1 percent as JPMorgan Chase & Co. upgraded the stock on higher commodity- price forecasts. Mitsui O.S.K. Lines Ltd., Japan’s No. 2 shipping line, fell 1.3 percent after the Baltic Dry Index slumped for a sixth day. The MSCI Asia Pacific Index was little changed at 120.45 as of 10:22 a.m. in Tokyo. The gauge has climbed 35 percent this year, set for its biggest annual gain since 2003, on signs government spending packages and lower interest rates are reviving the global economy. “There’s just a general feeling that we are winding down for New Year and the bulk of the buying has been done this year,” said Chris Weston , an institutional dealer at IG Markets in Melbourne. “We’re just lacking the catalyst to really attract buyers at present. Traders are more happy to trade individual news stories.” Japan’s Nikkei 225 Stock Average lost 0.4 percent. Australia’s S&P/ASX 200 Index rose 0.8 percent, while New Zealand’s NZX 50 Index added 0.3 percent. Futures on the Standard & Poor’s 500 Index were little changed. The gauge rose 0.7 percent to the highest since October 2008, as Abu Dhabi agreed to provide financing to Dubai’s financial support fund, allowing Dubai World to repay $4.1 billion of Islamic bonds that were due yesterday. The MSCI Asia Pacific Index has climbed 71 percent from a more than five-year low on March 9, outpacing gains of 65 percent by the S&P 500 and 56 percent for Europe’s Dow Jones Stoxx 600 Index . Stocks in the benchmark are valued at 22 times estimated earnings, compared with 18 times for the S&P and 16 times for the Stoxx. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Drop as U.S. Services Report Dims Recovery Hopes; Rio Drops

December 3, 2009

By Shani Raja Dec. 4 (Bloomberg) — Asian stocks fell from a 15-month high, led by mining companies, after U.S. service industries unexpectedly shrank, raising concern the economic recovery is still fragile. Rio Tinto Group , the world’s third-biggest mining company, dropped 2.4 percent in Sydney, as metal prices slid after a U.S. index of non-manufacturing businesses missed the median economist estimate. Mitsui Mining & Smelting Co. , a non-ferrous metal producer, declined 1.3 percent in Tokyo. James Hardie Industries NV , the top seller of home siding in the U.S., slumped 4.1 percent, ending a four-day winning streak. “The weak economic indicator in the world’s biggest economy should spur a sell-off,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. The MSCI Asia Pacific Index fell 0.4 percent to 121.19 as of 10:00 a.m. in Tokyo, after yesterday climbing to the highest level since Sept. 1, 2008. The gauge has advanced 6.5 percent this week, putting it on course for the steepest weekly gain since the period ended May 8. The index has rallied 72 percent from a more than five-year low on March 9 amid signs government stimulus measures are reviving global growth. Japan’s Nikkei 225 Stock Average declined 0.4 percent. The nation’s government will report slower economic growth for the July-September quarter than the 4.8 percent estimated previously when it announces revised figures on Dec. 9, the Nikkei newspaper said, without saying where it got the information. Japan Growth Australia’s S&P/ASX 200 Index fell 1.2 percent, while New Zealand’s NZX 50 Index retreated 0.3 percent in Wellington. South Korea’s Kospi Index was little changed. In New York, the Standard & Poor’s 500 Index fell for the first time in four days yesterday, losing 0.8 percent. The Institute for Supply Management’s index of businesses that make up almost 90 percent of the U.S. economy sank to 48.7 in November, compared with a median estimate of 51.5 by 71 economists. Fifty is the dividing line between expansion and contraction. James Hardie , which gets more than three-quarters of its revenue from North America, sank 4.1 percent to A$8.15, the biggest decline on the Asian benchmark index. Its shares rose 3.2 percent yesterday after the Federal Reserve said the U.S. economy had improved. Metals Decline Rio dropped 2.4 percent to A$71.74. The London Metal Exchange Index , a measure of six metals including copper and zinc, dropped 1 percent yesterday, breaking a three-day winning streak. BHP Billiton Ltd. , the world’s largest mining company, lost 1.7 percent to A$41.76. In Tokyo, Mitsui Mining declined 1.3 percent to 232 yen. The MSCI Asia Pacific Index’s rally from its March low has outpaced gains of 63 percent by the S&P 500 and 56 percent for Europe’s Dow Jones Stoxx 600 Index . Stocks in the benchmark are valued at 22 times estimated earnings, compared with 17 times for the S&P and 16 times for the Stoxx. Takefuji Corp. , a Japanese consumer lender, plunged 10 percent to 382 yen. The company is limiting loans because it has difficulty finding funds, the Asahi newspaper said, citing a company executive it didn’t identify. Mitsui Fudosan Co., a Japanese property developer, dropped 0.9 percent to 1,583 yen after having its rating cut to “underperform” from “outperform” at Mizuho Securities Co. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Japanese Exporter Stocks Jump as Yen Weakens, U.S. Consumer Spending Grows

December 2, 2009

By Patrick Chu and Shani Raja Dec. 3 (Bloomberg) — Shares of Japanese exporters soared, driving Asian stocks toward the biggest weekly gain since May, after the yen slid for the third day against the dollar and euro, and consumer spending lifted most regional economies in the U.S. The yen weakened against all 16 of its major counterparts and traded as low as 87.88 against the dollar today, the lowest since Nov. 25. The MSCI Asia Pacific Index rose 0.8 percent to 120.78 as of 12:10 p.m. in Tokyo, where Japan’s Nikkei 225 Stock Average jumped 2.3 percent to 9,828.41. The Federal Reserve yesterday said the world’s largest economy improved “modestly” across the U.S. from October to mid-November as consumer spending increased. The Fed said eight regions “indicated some pickup in activity or improvement in conditions,” in its Beige Book report. “The U.S. recovery might be more subdued than elsewhere, but it’s still a recovery,” said Prasad Patkar , who helps manage $1.7 billion at Platypus Asset Management in Sydney. ”As long as there are no systemic shocks, there is no underlying, fundamental reason for things to start going backwards.” The yen’s decline against the dollar helps boost the value of overseas earnings at Japanese companies when converted into their home currency. Toyota Motor Corp. , the world’s largest automaker, rose 3.9 percent in Tokyo to the highest since September. Sony Corp. , which gets almost 25 percent of its sales from the U.S., climbed 4.3 percent. Honda Motor Co ., which derives almost 60 percent of its sales abroad, gained more than 3.5 percent. Sharp Corp. gained 2.1 percent as the stock was lifted to “neutral” from “sell” at UBS AG. Yen’s Long Ascent The yen climbed to a 14-year high against the dollar last week and has averaged 93.89 this year, the strongest since currencies began trading freely in 1971. That has weighed on the Topix, making its 2.7 percent gain in 2009 the lowest return among the world’s 40 largest stock markets. Gold for immediate delivery climbed 0.8 percent to a record $1,225.04 an ounce and traded at $1,222.19 at 10 a.m. Singapore time, as the U.S. dollar index, which tracks the greenback against the currencies of six major U.S. trading partners, dropped as much as 0.2 percent. The precious metal has advanced 39 percent this year as investors sought to protect their wealth against a declining dollar. Talking Down Gold Hu Xiaolian , a deputy governor at the People’s Bank of China, said the price of gold is very high, Apple Daily reported today. The central bank will be wary of investments in “bubble” assets, the Hong Kong newspaper cited Hu as saying at an event in Taipei. There has been speculation that China may buy about 190 tons remaining from the 403.3 tons the International Monetary Fund announced Sept. 18 it would divest to shore up its finances. Crude oil traded below $77 a barrel in New York after falling 2.3 percent yesterday as a government report showed a gain in U.S. stockpiles last week as consumption declined in the world’s biggest energy consumer. “Energy is not the flavor of the day,” Jonathan Barratt , managing director at Commodity Broking Services Pty in Sydney, said by telephone. Crude oil for January delivery rose 25 cents to $76.85 a barrel in electronic trading on the New York Mercantile Exchange at 9:26 a.m. in Singapore. South Korea’s won fell 0.1 percent to 1,155.15 per dollar as the currency may be “affected” by a 50 percent narrowing in the current account surplus next year from more than $40 billion this year, Ahn Byung Chan , head of the international bureau at the Bank of Korea, said yesterday. Recovery, Imports “As you move into a deeper phase of recovery, import demand will pick up which will reduce the trade surplus,” said Wai Ho Leong , an economist with Barclays Plc in Singapore. “The recovery story is still pretty much intact. At the moment activity indicators in Asia may have paused but I don’t think there’s anything to worry about.” The Australian and New Zealand dollars gained before a government report tomorrow forecast to show U.S. job losses eased to the slowest pace in more than a year, boosting demand for higher-yielding assets. The Kiwi and Aussie were the biggest gainers against the dollar and the yen as signs of an economic recovery spurred demand for higher-yielding securities. Australia’s currency rose to 92.84 U.S. cents from 92.48 cents in New York yesterday, and gained 0.9 percent to 81.51 yen. New Zealand’s dollar climbed to 72.56 U.S. cents from 72.21 cents, and advanced 1 percent to 63.70 yen. Benchmark interest rates are 3.75 percent in Australia and 2.5 percent in New Zealand, compared with 0.1 percent in Japan and as low as zero in the U.S., attracting investors to the South Pacific nations’ higher-yielding assets. The risk in such trades is that currency market moves will erase profits. To contact the reporters on this story: Patrick Chu in Tokyo at pachu@bloomberg.net ; Shani Raja in Sydney at sraja4@bloomberg.net .

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Australian Schoolgirl Sets Sail in Attempt to Break Round-the-World Record

October 17, 2009

By Nichola Saminather and Shani Raja Oct. 18 (Bloomberg) — An Australian schoolgirl has begun her quest to become the youngest person to sail solo, non-stop and unassisted around the world. Jessica Watson, 16, who set sail from Sydney today, expects to spend about 240 days at sea on a 23,000-nautical mile (42,596-kilometer) journey that will take her past Fiji, up to the equator, then on to Cape Horn and the Cape of Good Hope before she heads back to Australia. “It’s a bit scary and possibly a dangerous thing,” said Watson, who began sailing at the age of eight. “But I’m not here without confidence.” The trip has sparked a debate about the wisdom of her undertaking such a dangerous voyage. Her record attempt, backed by more than 30 sponsors and suppliers including skincare brand Ella Bache and Panasonic, has prompted warnings that she is too young and inexperienced to take on such a challenge. Watson’s collision last month with a 63,000-ton Chinese bulk carrier as she sailed to Sydney from the northeastern state of Queensland where she lives handed ammunition to those urging her to reconsider the trip. Taking on the winds and waves of the Southern Ocean is like scaling Mount Everest “on your first climbing adventure,” Andrew Cape, who has sailed around Cape Horn seven times, wrote to Watson, the Australian newspaper reported. “I do not want to shatter your dreams but to undertake such a voyage requires more experience than you currently have.” Age No Barrier Jon Sanders , who single-handedly sailed three times around the globe non-stop in the 1980s, spending more than 650 days at sea, said age shouldn’t be viewed as a barrier. “I have found that if something goes wrong then it is usually a teenager who is first to go up the mast,” the 70- year-old yachtsman said in a telephone interview from the western Australian city of Perth, which lies on the Indian Ocean. “I have no worry about a 16-year-old taking that voyage.” Watson’s yacht — a 34-foot (10-meter) Sparkman and Stephens design — also stands in her favor, Sanders said. “If you close that boat up in heavy water, it is like a cork in a bottle,” Sanders said. “It is hard to sink. The boat will look after itself.” Dream of Adventure Watson says she has dreamed of a sailing adventure since her mother read her the book “Lionheart” by fellow Australian Jesse Martin , who set the solo, non-stop and unassisted sailing record she is trying to beat at the age of 18 in 1999. “I just kept putting myself in that position,” said Watson, who has chalked up more than 5,000 nautical offshore miles. “I kept asking myself the question ‘What would you be like in that situation?’ And I guess I just wanted to give it a go.” The teenager, who lists her interests as reading, cooking and chocolate, says on her Web site she hopes to “inspire young sailors, adventurers and everyone with a dream in their heart.” So far, headlines on the trip have been dominated by last month’s collision, which damaged the hull of her pink and white yacht, and broke the mast and rigging. Maritime Safety Queensland found she had no fatigue management plan in place and an anti-collision warning device on her boat hadn’t been switched on, the Australian Broadcasting Corp. reported at the time. ‘Scary and Dangerous’ “It was a scary and dangerous incident,” Watson wrote on her blog on Sept. 11. “The sound of Ella’s Pink Lady being scraped along the hull of a 63,000 ton ship isn’t something that I’m likely to ever forget,” she wrote. “Has it put me off? Well no, I’m as determined as ever.” Facing the media in Sydney two weeks ago, Watson said she’s had a “really big alarm” installed on her yacht and has discussed what went wrong with her team. “We’ve talked about sleeping, we’ve talked about the alarm system, we’ve talked about why it happened, why the equipment didn’t warn me of the boat,” she told reporters Oct. 7. The deaths of veteran sailor Andrew Short, 48, and his navigator Sally Gordon, 47, during a 170-kilometer race off the coast of New South Wales state on Oct. 10 highlighted the dangers of sailing. The 80-foot yacht ran into rocks in the early hours of the morning and 16 crew members were winched to safety. Extreme Conditions Long solo voyages and short races are both susceptible to the two most common causes of accidents while at sea: equipment failure and extreme conditions, said Phil Jones, chief executive officer of Sydney-based governing body Yachting Australia . Watson’s bid “raises the broader issue of whether records such as the youngest should be recognized at all,” Jones said. “If you have a record for the youngest, inevitably younger and younger people are going to do this.” Unlike Dutch authorities, who ruled 13-year-old Laura Dekker couldn’t embark on a solo round-the-world sailing voyage, officials in Australia say the issue is for Watson and her family to decide. “Governments cannot legislate to stop everything, governments cannot legislate for common sense,” Queensland Deputy Premier Paul Lucas told reporters last month. “All I say is, this is a very serious matter and I appeal to Jessica and her parents as to whether she is in fact ready to do this.” To contact the reporter on this story: Nichola Saminather in Sydney at nsaminather1@bloomberg.net Shani Raja in Sydney at sraja4@bloomberg.net

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S&P 500 Index Headed for `Stiff Correction,’ AMP Says: Technical Analysis

October 16, 2009

By Shani Raja Oct. 16 (Bloomberg) — The U.S. Standard & Poor’s 500 Index may be due for a “stiff” slump as it approaches a resistance level in coming weeks, according to Nader Naeimi , a strategist at AMP Capital Markets, which holds assets worth $75 billion. The U.S. index’s 62 percent rally from its March low has brought it close to 1,121.4, which Naeimi says represents the 50 percent level Fibonacci analysts identify as a key resistance point. The performance of the index, which closed at 1,096.56 yesterday, is also diverging from measures of price and breadth momentum, pointing to a deeper “correction” than those that have occurred since the rally began, the strategist said. “The divergences have started to build up over the past few weeks,” said Sydney-based Naeimi, whose firm went to “overweight” from “underweight” stocks in March. “The new highs the index is making aren’t being confirmed by the measures of momentum. The next push higher is likely to extend those divergences, which suggests we’ll see a deeper correction that lasts several weeks or longer, rather than just days.” The S&P 500 slumped 38.5 percent last year as the financial crisis deepened, tipping nations into a global recession. The index has rebounded from a more than 12-year low on March 9, as government stimulus measures helped calm credit markets and shore up economic growth. The S&P 500 may climb to the critical 50 percent Fibonacci level in the next few weeks, at which point a slide of between 10 percent and 15 percent is likely, said Naeimi. Previous Declines That’s deeper than three previous “corrections” that have occurred since the rally began in March, the strategist said. The first was a 5 percent drop between May 8 and May 15, followed by a 7.1 percent slump between June 12 and July 10, and a decline of 4.3 percent between Sept. 22 and Oct. 2. “We will see multiple negative divergences as the S&P 500 hits a new cyclical high,” said Naeimi “All the conditions for a stiff correction are in place. The cyclical bull market will continue once the correction has run its course.” Naeimi applies Fibonacci analysis to the period between the index’s Oct. 9, 2007 high of 1,565.15 and this year’s March low to arrive at the 1,121.4 resistance level . In technical analysis, a Fibonacci retracement  is created by taking two extreme points on a stock chart and dividing the vertical distance by the key Fibonacci ratios of 23.6 percent, 38.2 percent, 50 percent, 61.8 percent and 100 percent, according to Investopedia.com. Once these levels are identified, horizontal lines are drawn and used to identify possible resistance and support levels. The AMP strategist also uses the relative-strength index, a momentum indicator, to gauge the level of “conviction” at various stages of the rally. For breadth momentum, Naeimi adopts the McClellan Oscillator , which measures how broad-based a rally is in terms of the number of companies involved. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Advance for Second Day on NGK Profit Forecast, Micron Results

September 29, 2009

By Shani Raja Sept. 30 (Bloomberg) — Asian stocks rose for a second day, led by automakers and technology companies, after NGK Insulators Ltd. raised its profit forecast and Micron Technology Inc. reported a narrower loss. NGK Insulators surged 8.1 percent in Tokyo after citing growing demand for products related to cars and electronics for its higher forecast. Hynix Semiconductor Inc. gained 2.6 percent in Seoul as Micron’s results boosted optimism a glut in the memory-chip industry is easing. Billabong International Ltd., Australia’s biggest surfwear maker, climbed 3.6 percent on a greater-than-estimated retail sales report. The MSCI Asia Pacific Index added 0.5 percent to 117.33 as of 11:38 a.m. in Tokyo. The gauge is set for its second-straight quarterly advance, having climbed 14 percent in the past three months as economies around the world emerged from recession. “The recovery is moving from being supported by governments and central banks to being a bit more self-sustained,” said Nader Naeimi , a Sydney-based strategist at AMP Capital Investors, which manages about $75 billion. “Across Asia we’re seeing strong private demand as well as a strong pick-up in actual measures of economic activity.” The Shanghai Composite Index climbed 1 percent in China, where markets are closed from tomorrow for a week-long holiday. South Korea’s Kospi Index gained 0.6 percent, while Taiwan’s Taiex Index added 0.7 percent. Japan’s Nikkei 225 Stock Average was little changed. Hai-O Enterprise Bhd., a Malaysian seller of Chinese wines, herbs and medicines, rose 4.9 percent to a record after first- quarter profit climbed 36 percent. U.S. Home Prices Futures on the U.S. Standard & Poor’s 500 Index were little changed. The gauge fluctuated between gains and losses yesterday before finishing down 0.2 percent. The S&P/Case-Shiller home- price index climbed 1.2 percent in July from the previous month, the most since October 2005, according to an S&P report . In Tokyo, NGK Insulators surged 8.1 percent to 2,065 yen after boosting its profit forecast for the year ending March 31, 2010, by 14 percent to 12.5 billion yen ($139 million). Hynix climbed 3.1 percent to 20,150 won, while Samsung Electronics Co., the world’s largest maker of computer memory, lost 1.4 percent to 823,000 won. Taiwan Semiconductor Manufacturing Co., the world’s largest maker of customized chips, gained 1.9 percent to NT$64.90. Technology companies accounted for 20 percent of the MSCI Asia Pacific Index’s gain today after Micron said its fourth- quarter net loss narrowed to $88 million from $344 million a year earlier. The loss in the period of 10 cents a share beat the 19 cents estimated by analysts in a Bloomberg survey. Memory Chips Bankruptcies and factory shutdowns have helped the memory industry pare an oversupply of chips, pushing up prices closer to the cost of production. Micron makes dynamic random access memory, or DRAM , for personal computers, as well as Nand flash chips, which store information. The MSCI Asia Pacific Index has added 3.4 percent in September, set for a seventh monthly advance, its longest stretch of gains since the 10 months ended July 2007. Japan’s Topix index and the Nikkei 225 are the worst performers this month among 88 global equity indexes tracked by Bloomberg, amid uncertainties over policies from the nation’s new government. The MSCI index’s gain in the past three months is lower than the second quarter’s 28 percent as concerns emerged the stock rally may have overvalued company earnings prospects. The average price of the gauge’s shares rose to 1.6 times book value on Sept. 17, up from 1 at the measure’s five-year low on March 9. Australian Retail Sales The climb in equities in the past seven months has been fueled by better-than-estimated economic and earnings reports. Australian retail sales climbed 0.9 percent in August, the first gain in three months, the country’s statistics bureau reported today. The median forecast of economists surveyed by Bloomberg News was for a 0.5 percent gain. Billabong rose 3.6 percent to A$11.95 in Sydney, while Harvey Norman Holdings Ltd., Australia’s largest furniture and electrical retailer, added 1.4 percent to A$4.33. In Kuala Lumpur, Hai-O Enterprise advanced 4.9 percent to a record 5.97 ringgit after first-quarter profit climbed 36 percent. OSK Research Sdn. upgraded the stock to “buy” from “neutral.” To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Advance on Brokerage Upgrades; Samsung Electronics, STX Rise

September 21, 2009

By Shani Raja Sept. 22 (Bloomberg) — Asian stocks rose for the first time in three days after Citigroup Inc. raised Samsung Electronics Co.’s price estimate and Morgan Stanley lifted its rating on companies that make automobile batteries. Samsung Electronics , the world’s largest computer-memory chipmaker, rose 2 percent, as chip prices also climbed to their highest level in more than a year. LG Chem Ltd. and Samsung SDI Co. gained more than 5 percent in Seoul after being raised to “overweight” at Morgan Stanley. STX Pan Ocean Co., South Korea’s biggest commodity-shipping line, rose 8.3 percent in Singapore after securing its largest contract. The MSCI Asia Pacific excluding Japan Index added 0.4 percent to 390.97 as of 10:34 p.m. in Tokyo. Markets in Japan, Malaysia, Indonesia and Pakistan are shut for holidays. The gauge that includes Japan has rallied 67 percent from a five- year low on March 9, lifting the average price of its stocks to 1.6 times book value from 1.03 at this year’s trough. “Valuations at this juncture are not cheap,” said Tim Schroeders , who helps manage about $1 billion at Pengana Capital Ltd. in Melbourne. “However, if underlying levels of economic activity can continue to improve and profitability continues to grow, that should be sufficient to sustain current market levels.” South Korea’s Kospi index gained 1 percent, while Hong Kong’s Hang Seng Index added 0.3 percent. The Shanghai Composite Index fell 0.4 percent. Australia’s benchmark S&P/ASX 200 Index lost 0.1 percent. Babcock & Brown Infrastructure Group Ltd., a Sydney-based investor in energy and transport assets, slumped 5.6 percent after its board expressed concern over a new recapitalization proposal. Valuation Concerns Futures on the U.S. Standard & Poor’s 500 Index gained 0.2 percent. The gauge fell 0.3 percent to 1,064.66 yesterday on speculation a six-month rally has outpaced prospects for profit growth, even as an index of U.S. leading economic indicators rose for the fifth straight month. “We are never out of the woods,” said Donald Gimbel , senior managing director of Carret & Co., which manages $1.5 billion in assets. “One has to buy quality companies that aren’t overvalued. It sounds simple, but it takes work to find stocks that meet our strict criteria.” Samsung Electronics gained 2 percent to 814,000 won in Seoul. Citigroup raised its price estimate to 1,030,000 won from 900,000 won on expectations earnings will benefit from growing demand for computer-memory chips, according to a note yesterday. Separately, the price of the benchmark computer-memory chip climbed 1.1 percent yesterday to the highest level since Aug. 27, 2008, according to Dramexchange Technology Inc. STX Pan Ocean LG Chem climbed 8.1 percent to 240,000 won, while Samsung SDI jumped 5.5 percent to 173,000 won. Morgan Stanley upgraded the companies from “equal weight” in a report that said they may sign additional auto battery contracts. STX Pan Ocean surged 8.3 percent to S$14.40 after winning a 25-year contract to move iron ore for Vale SA to China from Brazil. News that the two companies were in talks boosted STX’s shares in Seoul by 8.2 percent yesterday. The Singaporean stock didn’t trade yesterday because of a public holiday. The MSCI Asia Pacific Index’s six-month rally has been driven by better-than-estimated economic reports and corporate earnings . Of 648 companies on the gauge that reported net income for the latest quarter, 225 beat analyst predictions, compared with 138 that missed. The index has now recovered to levels last seen before the collapse of Lehman Brothers Holdings Inc. a year ago. The ensuing credit crisis caused more than $1.6 trillion in losses at financial institutions and helped drag economies globally into recession. Babcock Infrastructure slumped 5.7 percent to 5 Australian cents. The board of the Sydney-based company, which is also weighing a transaction with a potential cornerstone equity investor, said it has “a number of concerns” as to whether legally and commercially a proposal submitted by Royal Bank of Scotland Group Plc can be executed. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Fall as Yen Strengthens, Commodities Decline; Japan Air Rises

September 13, 2009

By Shani Raja

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Most Asian Stocks Fall on U.S. Jobless Report, Stronger Yen; Honda Drops

September 2, 2009

By Shani Raja Sept. 3 (Bloomberg) — Most Asian stocks fell, led by automakers and electronic companies, as U.S. employers cut more jobs than forecast and the yen climbed. Mining companies rose. Honda Motor Co., which gets 45 percent of its revenue in North America, dropped 2.6 percent in Tokyo. Sony Corp., which makes three quarters of its sales abroad, lost 1.6 percent as the yen rose to a seven-week high versus the dollar. Newcrest Mining Ltd., Australia’s largest gold miner, climbed 6.2 percent after gold climbed the most in more than five months. More than two stocks declined for each one that advanced on the MSCI Asia Pacific Index , which dropped 0.3 percent to 112.10 as of 9:58 a.m. in Tokyo. The gauge has climbed 59 percent from a more than five-year low on March 9 on speculation the global economy is recovering. “The economic data has caught up to where the market was,” said Stephen Halmarick , Sydney-based head of investment- markets research at the firm, which holds about $115 billion. “For the equity market to really move on again, you need the next stage to take place, which is a more sustained recovery and better profitability.” Japan’s Nikkei 225 Stock Average fell 0.8 percent, while Australia’s S&P/ASX 200 Index sank 0.4 percent. South Korea’s Kospi Index lost 0.3 percent. ‘Considerable Uncertainty’ Futures on the Standard & Poor’s 500 Index dropped 0.2 percent. The gauge lost 0.3 percent as a survey by ADP Employer Services showed businesses reduced payrolls by 298,000 in August, while economists had forecast a drop of 250,000. The Federal Reserve expressed “considerable uncertainty” about the strength of the economic recovery, minutes of its August meeting showed. Honda sank 2.6 percent to 2,835 yen as the stronger yen threatens the value of sales generated overseas. The yen appreciated to as much as 91.95 per dollar, a level not seen since July 13. Japan’s currency also gained to a seven-week high versus the euro. Toyota Motor Corp., the world’s largest automaker, lost 1.5 percent to 3,860 yen. Sony dropped 1.6 percent to 2,415 yen. “Investors are turning cautious as employment concerns have flared up again, while the stronger yen is going to be tough on the exporters,” said Mitsushige Akino , who oversees the equivalent of $637 million at Tokyo-based Ichiyoshi Investment Management Co. “The market is likely to stay in a tight range today. It’s going to be very hard for stocks to start pushing to new highs.” The MSCI Asia Pacific Index’s rally since March has boosted the average price of stocks in the gauge to 23 times estimated earnings, compared with 16.5 times for the S&P 500, data compiled by Bloomberg show. A weaker dollar spurred demand for gold as an alternative investment, sending the precious metal’s futures up by 2.3 percent in New York. The gain was the biggest since March 19. Newcrest climbed 6.2 percent to A$31.42. Lihir Gold Ltd., Australia’s second-biggest gold mining company, jumped 6.8 percent to A$2.97. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Decline, With China Approaching Bear Market; Maanshan Falls

August 18, 2009

By Jonathan Burgos and Shani Raja Aug. 19 (Bloomberg) — Asian stocks fell, with China’s key index approaching levels signaling a bear market, after Maanshan Iron & Steel Co. reported losses and Japanese regulators said new guidelines will hurt insurers’ solvency ratios. Maanshan Steel, China’s No. 4 listed steelmaker, sank 6.9 percent in Shanghai. Tokio Marine Holdings Inc. dropped 2 percent in Tokyo. Honda Motor Co. , Japan’s No. 2 automaker, added 1.7 percent after Nomura Holdings Inc. upgraded Japan’s auto industry. Qantas Airways Ltd. , Australia’s biggest airline, advanced 4.6 percent as it signaled improving passenger volumes. The MSCI Asia Pacific Index fell 0.3 percent to 110.33 as of 2:54 p.m. in Tokyo, erasing an earlier gain of 0.6 percent. The gauge has rallied 56 percent from a more than five-year low on March 9 amid speculation the global economy is recovering. “The earnings season has been surprising,” said Nader Naeimi , a Sydney-based strategist at AMP Capital Investors, which manages about $95 billion. “It’s given investors confidence the recovery is coming through and that valuations will be supported by strong earnings. Still, markets have rallied a long way and are vulnerable to bad news.” To contact the reporter for this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net ; Shani Raja in Sydney at sraja4@bloomberg.net .

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Telstra Posts Biggest Profit in Four Years as Mobile Sales Beat Fixed-Line

August 12, 2009

By Robert Fenner and Shani Raja Aug. 13 (Bloomberg) — Telstra Corp. , Australia’s largest phone company, posted its biggest annual profit in four years as earnings from mobile phones overtook traditional fixed-line services for the first time. Net income increased 10 percent to A$4.07 billion ($3.4 billion) in the 12 months ended June 30, Melbourne-based Telstra said in a statement today. The shares fell after new Chief Executive Officer David Thodey abandoned profitability targets set by his predecessor, Sol Trujillo . Apple Inc.’s iPhone and other so-called smart phones helped drive up wireless-Internet data sales 31 percent. Users of the company’s wireless service increased spending 4.8 percent in the past year to download music and surf the Web with their handsets. “The mobile business really is coming into its own,” said Rhett Kessler , who helps manage $1.1 billion at Pengana Capital Ltd. in Melbourne. “Sales momentum, customer acquisition, profitability and cash flow of the mobile business indicates that this is the jewel of Telstra’s operations.” Net income exceeded the A$3.8 billion median of 8 analyst estimates compiled by Bloomberg. Telstra shares fell 0.8 percent to A$3.58 at 11:17 a.m. in Sydney trading, compared with a 1.3 percent advance by the benchmark S&P/ASX 200 Index. Mobile Passes Fixed Line Total mobile sales, which includes handsets, calls and data, rose 7.3 percent to A$6.8 billion while fixed-line revenue fell 4.9 percent to A$6.3 billion. Thodey , three months into his role as Telstra’s chief executive officer, scaled back some of the targets for 2010 set by Trujillo amid declining revenue from traditional services and slowing economic growth. Earnings before interest, taxes, depreciation and amortization as a percentage of sales will probably be little changed this fiscal year from 2009, when it was 43 percent, the company said. Under Trujillo, the company had targeted the margin to rise to between 46 percent and 48 percent. Free cash flow in 2010 will be at the bottom of the company’s previous guidance of A$6 billion to A$7 billion, while sales will grow by a “low single digit” percentage after previously projecting a rise of 3 percent to 4 percent, according to Telstra. “Telstra faces significant challenges in the coming year, but we are well positioned to face those challenges,” Thodey said in a statement. Thodey in Charge Thodey took over as CEO on May 19, with Trujillo leaving more than three years into a five-year plan to boost earnings by slashing as many as 12,000 workers and investing more than A$10 billion to upgrade its network speed and coverage. Trujillo’s tenure was marked by clashes with successive governments over access to its copper-wire service, the nation’s only national fixed-line phone network. Prime Minister Kevin Rudd said April 7 the government would build a high-speed network, promising speeds faster than currently available, after disqualifying Telstra from bidding. The government expects to complete a study into the National Broadband Network by the end of March. “We are now engaging constructively with the Federal government, as well as the new NBN company,” Thodey said. “We are working to find the right way to deliver the objective of a world-class communications infrastructure for Australia, while protecting Telstra shareholders.” Second-ranked rival Singapore Telecommunications Ltd.’s Optus unit and Australia’s antitrust regulator both say the path to success for the new network is to force a split between Telstra’s wholesale and retail arms. Earnings at Sydney-based SingTel Optus Pty rose 13 percent to A$139 million last quarter, the parent company said today. To contact the reporters on this story: Robert Fenner in Melbourne rfenner@bloomberg.net ; To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Fall as Commodity Prices Drop; Mitsubishi, Ascendas Decline

August 11, 2009

By Shani Raja Aug. 12 (Bloomberg) — Asian stocks fell for the first time in three days, as commodity prices declined and a weaker dollar reduced Japanese automakers’ overseas earnings prospects. Mitsubishi Corp. , a Japanese trading company that gets more than a third of its sales from commodities, lost 2 percent. Honda Motor Co. , which generates 45 percent of its sales in North America, dropped 2.2 percent in Tokyo. Ascendas Real Estate Investment Trust slumped 5.1 percent in Singapore after selling shares at a discount. “We’ve had an incredible run the last few months,” said Tim Schroeders , who helps manage $1.1 billion at Pengana Capital Ltd. in Melbourne. “We need to see economic growth exceed the improved expectations that have flowed through to the market. Any disappointment will see stock prices fall back significantly from current levels.” The MSCI Asia Pacific Index dropped 0.8 percent to 111.82 as of 11:08 a.m. in Tokyo, following a two-day, 1.8 percent advance. The gauge has climbed 59 percent from a five-year low on March 9 amid speculation the global economy is recovering. Japan’s Nikkei 225 Stock Average dropped 0.8 percent, while Hong Kong’s Hang Seng Index slumped 2 percent. China’s Shanghai Composite Index dropped 1.2 percent. South Korea’s Kospi Index sank 1.1 percent. Australia’s S&P/ASX 200 Index rose 0.1 percent as better- than-estimated profit lifted Commonwealth Bank of Australia by 2.5 percent. Limiting gains in Sydney, developer Stockland sank 3.4 percent after reporting a full-year loss. Futures on the Standard & Poor’s 500 Index added 0.2 percent. The gauge slid 1.3 percent yesterday as Dick Bove, an analyst at Rochdale Securities, said the recent rally in banking shares was driven by a change in investor sentiment and earnings in the industry won’t improve in the third and fourth quarters. Oil, Metals Mitsubishi sank 2 percent to 1,934 yen. Mitsui & Co., a rival trading house, fell 3 percent to 1,259 yen. Crude oil dropped for a fourth day with a 1.6 percent decline in New York yesterday. A gauge of six metals in London fell 2 percent. Rio Tinto Group , the world’s third-largest mining company, lost 0.7 percent to A$57.52 as China’s official Xinhua News Agency reported four of the company’s workers had been arrested for infringing trade secrets. Honda dropped 2.2 percent to 3,050 yen as the stronger yen threatens to reduce the value of dollar-denominated sales. The yen strengthened against the dollar to as much as 95.91 from 96.81 at the 3 p.m. close of Tokyo stock trading yesterday. Toyota Motor Corp. fell 1.5 percent to 4,070 yen. Ascendas slumped 5.1 percent to S$1.67. The company said it sold 185 million shares at S$1.63 each, raising S$296 million ($204 million) in net proceeds. The stock last traded at S$1.76 on Aug. 7. Commonwealth Bank Earnings Commonwealth Bank, Australia’s No. 2 lender by market value, gained 2.5 percent to A$45.01. The bank posted full-year earnings of A$4.72 billion, compared with the median estimate of eight analysts surveyed by Bloomberg for A$4.64 billion. A third of the 457 companies in the MSCI Asia Pacific Index that have reported quarterly results so far have beaten analysts’ profit estimates , while 17 percent have missed, according to data compiled by Bloomberg. Better-than-expected earnings and economic reports worldwide have driven stocks higher since March, lifting the average valuation of the MSCI Asia Pacific’s companies to a four-month high of 25 times estimated profit on July 28. Data last week showed Australian employers unexpectedly added jobs and pointed to improving manufacturing industries in China, Europe and the U.S. “Investors are wary of the pace of the recent gain and they’ll likely book profits,” said Hiroichi Nishi , an equities manager at Tokyo-based Nikko Cordial Securities Inc. Stockland , Australia’s biggest housing developer, sank 3.2 percent to A$3.30. The company reported a full-year loss because of writedowns related to a slump in the value of property assets. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Drop on Economic Growth Concerns; Toyota Motor, Konica Fall

August 6, 2009

By Shani Raja

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Macquarie’s Moore Says Fund Model Evolving, Not Broken, Amid Asset Sales

July 28, 2009

By Shani Raja July 29 (Bloomberg) — Macquarie Group Ltd. Chief Executive Officer Nicholas Moore said the investment bank’s business model that relied on so-called satellite funds to drive 16 years of rising profits isn’t broken and is evolving. “It’s a collection of businesses that all operate very closely together at the margin,” Moore said before the company’s annual general meeting in Sydney today. “At all our groups our people are looking at the market, looking at what’s available, and making use of opportunities.” Moore has been distancing the company from its publicly traded funds after an unbroken streak of earnings gains ended last year as the bank wrote down the value of the satellite funds it spawned.

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Macquarie’s Moore Says Fund Model Evolving, Not Broken, Amid Asset Sales

July 28, 2009

By Shani Raja July 29 (Bloomberg) — Macquarie Group Ltd. Chief Executive Officer Nicholas Moore said the investment bank’s business model that relied on so-called satellite funds to drive 16 years of rising profits isn’t broken and is evolving. “It’s a collection of businesses that all operate very closely together at the margin,” Moore said before the company’s annual general meeting in Sydney today. “At all our groups our people are looking at the market, looking at what’s available, and making use of opportunities.” Moore has been distancing the company from its publicly traded funds after an unbroken streak of earnings gains ended last year as the bank wrote down the value of the satellite funds it spawned.

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Sinochem Confirms `Preliminary’ Discussions on Possible Takeover of Nufarm

July 26, 2009

By Shani Raja and Rebecca Keenan July 27 (Bloomberg) — China’s Sinochem Corp. confirmed it’s in “early stage” talks for a potential takeover of Nufarm Ltd. , marking the Asian nation’s second attempt in as many years to buy Australia’s biggest supplier of farm chemicals

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Sinochem Confirms `Preliminary’ Discussions on Possible Takeover of Nufarm

July 26, 2009

By Shani Raja and Rebecca Keenan July 27 (Bloomberg) — China’s Sinochem Corp. confirmed it’s in “early stage” talks for a potential takeover of Nufarm Ltd.

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Sinochem Confirms `Preliminary’ Discussions on Possible Takeover of Nufarm

July 26, 2009

By Shani Raja and Rebecca Keenan July 27 (Bloomberg) — China’s Sinochem Corp. confirmed it’s in “early stage” talks for a potential takeover of Nufarm Ltd. , marking the Asian nation’s second attempt in as many years to buy Australia’s biggest supplier of farm chemicals

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