ASIAN stocks rose last week, driving up the benchmark index by the most this year, on optimism the US Federal Reserve will succeed in stoking growth in the world’s biggest economy.
Mitsubishi Corp, Japan’s biggest commodities trader, advanced 7.8% in Tokyo as oil and metal prices climbed. Cnooc Ltd, China’s biggest offshore oil explorer, jumped 10% in Hong Kong. BHP Billiton Ltd and Rio Tinto Group, the world’s No. 1 and No. 3 mining companies, climbed more than 5% in Sydney. Nissan Motor Co, Japan’s No. 3 carmaker, gained 7.6% after reporting higher-than-expected earnings and raising its profit forecast.
“We’re seeing follow-through strength in risky assets, suggesting that not all of the US quantitative-easing news was in the price,” said Prasad Patkar, who helps manage about US$1.8bil at Platypus Asset Management Ltd in Sydney. “The market had been expecting a second round of easing, but it appears the rumour wasn’t bought to the extent feared. That’s why we’re not seeing any selling.”
The MSCI Asia Pacific Index rose 4.2% last week to 134.82, its steepest increase since the five days ended Dec 4.
The gauge has risen about 12% in 2010 on speculation profits will weather Europe’s debt crisis, China’s steps to curb property price gains and concern about the pace of US economic growth. Shares in the gauge trade at an average of about 15 times estimated earnings, the highest level since June.
The MSCI Index had its biggest two-day gain since May and equity markets rose worldwide after the Federal Reserve said Nov 3 that it will purchase as much as US$600bil of assets through June, expanding record measures to support the US economy.
Japan’s Nikkei 225 Stock Average climbed 4.6% in the four days it was open last week. Hong Kong’s Hang Seng Index surged 7.7%, South Korea’s Kospi Index gained 3%. China’s Shanghai Composite Index surged 5.1%. Australia’s S&P/ASX 200 Index rose 3%.
Mitsubishi, which gets more than 40% of its sales from metals and energy, gained 7.8% to ¥2,086 last week. In Hong Kong, Cnooc jumped 10% to HK$17.68 and Jiangxi Copper Co, China’s largest producer of the metal, advanced 16% to HK$25.10. Rio Tinto increased 5.5% to A$87.20. BHP advanced 8% to A$45.27. Canadian regulators blocked BHP’s hostile bid for Potash Corp of Saskatchewan Inc.
Crude oil for December delivery advanced to as much as US$87.22 a barrel before Asia’s main markets closed for the week, the highest price since October 2008. The London Metal Exchange Index of prices for six industrial metals jumped 4.8% last week before Asian trading closed.
Nissan rose 7.6% to ¥764. The carmaker expects ¥270bil (US$3.3bil) in net income in the year to March, compared with an earlier forecast of ¥150bil, the Yokohama-based company said. Nissan posted ¥102bil in profit for the three months ended Sept 30, beating the ¥89bil average estimate of 6 analysts surveyed by Bloomberg.
Country Garden Holdings Co, a Chinese developer controlled by billionaire Yang Huiyan, soared 16% to HK$3.19 after saying contracted sales jumped 65% in the first 10 months from a year earlier.
About six companies in the MSCI Asia Pacific Index have exceeded profit estimates for every five that have fallen short, based on Bloomberg data compiled from about 450 companies that have reported quarterly results since Oct 7.
Resona Holdings Inc, Japan’s fourth-biggest bank, plunged 20% to ¥512 in Tokyo after reports said it plans to sell shares to help repay a government bailout. – Bloomberg
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