By Jonathan Burgos and Norie Kuboyama - Sep 3, 2010 12:42 PM GMT+0800
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Play VideoSept. 2 (Bloomberg) -- John Vail, chief global strategist at Nikko Asset Management, talks about equity investment opportunities in Japan and the impact of the strengthening yen on strategy. He speaks with Mark Barton on Bloomberg Television's "Countdown." (Source: Bloomberg)
Play VideoSept. 2 (Bloomberg) -- Bloomberg's Elizabeth Faublas reports on the performance of the U.S. equity market today. U.S. stocks rose, with the Standard & Poor’s 500 Index building on its biggest rally in almost two months, after retail sales improved, initial jobless claims fell and pending home sales unexpectedly increased. Bloomberg's Pimm Fox also speaks. (Source: Bloomberg)
Most Asian stocks rose, led by technology companies, after U.S. reports showed an unexpected increase in pending home sales and improved retail sales.
Sony Corp., the electronics maker that gets 22 percent of sales from the U.S., rose 1.6 percent. James Hardie Industries SE, the biggest seller of home siding in the U.S., climbed 4.4 percent in Sydney. Toyota Motor Corp., an automaker that earns about 70 percent of its revenue abroad, increased 1.2 percent. OZ Minerals Ltd., an Australian copper and gold producer, surged 5 percent as commodity prices advanced.
“Investors are kind of relieved because a downward spiral in the global economy had a pause this week,” said Naoki Fujiwara, who helps oversee about $6 billion in Tokyo at Shinkin Asset Management Co. “But investors won’t jump into buying shares just because of that, since there is still a strong sense of uncertainty.”
The MSCI Asia Pacific Index gained 0.3 percent to 119.63 as of 1:39 p.m. in Tokyo, extending its advanced for a third day. The gauge advanced 2.4 percent this week after Japan’s government said it’s preparing a new stimulus plan to help businesses threatened by the strong yen and as reports showed Chinese and U.S. manufacturing, as well as the Australian economy, grew faster than economists estimated.
Japan’s Nikkei 225 Stock Average gained 0.6 percent. Taiwan’s Taiex Index climbed 1.3 percent, the most among Asia Pacific major gauges as the nation’s technology companies rallied.
South Korea’s Kospi Index and Hong Kong’s Hang Seng Index rose at least 0.1 percent. New Zealand’s NZX 50 Index increased 0.7 percent.
Chain Store Data
Futures on the Standard & Poor’s 500 Index fell 0.2 percent today. In New York yesterday, the index increased 0.9 percent, rounding out its biggest two-day gain since early July, after a report showed pending sales of existing U.S. houses climbed 5.2 percent in July, compared with a 1 percent drop economists had estimated in a Bloomberg survey.
Same-store sales at 30 U.S. retail chains probably rose 3.5 percent in August, according to Retail Metrics Inc., beating analysts’ estimates of 2.8 percent.
“The excessive pessimism about the U.S. economy is coming to a halt,” said Juichi Wako, a senior strategist at Tokyo- based Nomura Holdings Inc. “The market was totally pessimistic, but a ray of sunlight has come out this week.”
Exporters Advance
Sony, the maker of Bravia televisions, climbed 1.6 percent to 2,466 yen. Canon Inc., a Japanese camera maker that gets 28 percent of its revenue from the Americas, rose 0.9 percent to 3,535 yen. James Hardie, which counts the U.S. as its biggest market, climbed 4.4 percent to A$5.51 in Sydney.
Japanese exporters also increased as the yen depreciated to as low as 84.43 against the dollar today in Tokyo, compared with 84.17 at the close of stock trading yesterday. A weaker yen boosts overseas income at Japanese companies when converted into their home currency.
Toyota Motor, the world’s biggest automaker, gained 1.2 percent to 2,885 yen. Toshiba Corp., the world’s second-biggest maker of flash memory, advanced 0.8 percent to 387 yen.
The MSCI Asia Pacific Index has declined 2.2 percent from a three-month high on Aug. 6 as the yen’s advance to a 15-year high against the dollar and disappointing U.S. data fueled global growth concerns. U.S. government reports released last month showed orders for durable goods increased less than forecast in July and companies hired fewer workers in the same month.
Tech Stocks Climb
Stocks on the MSCI gauge are valued at an average 13.7 times estimated earnings, compared with 13.1 times for the S&P 500 Index and 11.6 times for the Stoxx Europe 600 Index.
A measure of technology companies posted the biggest advance among the 10 industry groups in the MSCI index amid expectations demand will increase.
In Taipei, Realtek Semiconductor Corp., a maker of chips used in computers, surged 6.9 percent, the second-biggest advance on the MSCI Asia Pacific Index, to NT$67.9. Investors are speculating revenue will rise this month, said Lucas Chen, an analyst at Polaris Securities Co.
Chimei Innolux Corp., Taiwan’s largest maker of liquid- crystal displays, advanced 6.9 percent to NT$35.75, amid speculation fourth-quarter demand for consumer electronics will improve from the previous three months, said Richard Ko, an analyst at Jih Sun Securities Co.
Esprit Declines
PT Indosat, Indonesia’s second-biggest phone operator, surged 7.1 percent to 4,900 rupiah after Deustche Bank AG raised the stock to “hold’ from “sell.”
Raw-material producers climbed after crude oil for October delivery rose 1.5 percent yesterday in New York. The London Metal Exchange Index of six metals including aluminum and copper advanced for a second day yesterday to the highest level since April 30.
OZ Minerals Ltd., which has mines in Africa and Asia, climbed 5 percent to A$1.37, its highest level since October 2008, in Sydney. Mitsubishi Corp., Japan’s biggest commodities trader, rose 0.7 percent to 1,840 yen. Inpex Corp., Japan’s largest oil explorer, climbed 1.4 percent to 406,000 yen.
Among stocks that declined today, Esprit Holdings Ltd., the biggest clothier listed in Hong Kong, tumbled 5.2 percent to HK$40.65 after JPMorgan Chase & Co and CIMB Group Holdings Bhd. cut their ratings on the stock. The company yesterday reported full-year earnings that missed analysts’ estimates.
To contact the reporters on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net
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