Asian Stocks Headed for Highest Closing Level Since 2008

By Yoshiaki Nohara 

Asian stocks rose, with the regional benchmark index heading for the highest closing level since June 2008, after U.S. housing sales gained and amid speculation central banks will keep stimulating growth.

Samsung Electronics Co. (005930), South Korea’s biggest exporter of consumer electronics, rose 3.2 percent. Australia & New Zealand Banking Group Ltd. (ANZ), Australia’s third-largest lender, gained 5.3 percent toward a record in Sydney after boosting its dividend as first-half cash profit climbed 10 percent. Honda Motor Co. dropped 3.1 percent after Japan’s No. 2 automaker by market value forecast profit that missed analyst estimates. The MSCI Asia Pacific Index added 1 percent to 141.84 at 2:08 p.m. in Tokyo, with almost three shares rising for each that fell. The measure has advanced 4.6 percent this month, extending gains for a sixth month, the longest winning streak since September 2009.

“There’s plenty of liquidity around the world, and so one would presume we will continue to see the rally for the next six to 12 months, said Khiem Do, Hong Kong-based head of Asian multi-asset strategy at Baring Asset Management Ltd., which manages about $51 billion. ‘‘In the short-term, some markets like Japan and the U.S. have been overbought and could consolidate from day to day. But we are not talking about a 10-15 percent correction.’’

The MSCI Asia Pacific Index climbed 8.6 percent this year through yesterday amid optimism Japan will deploy more measures to beat deflation and that policy makers in the U.S. and China remain on standby to support growth.

The Asian benchmark traded at 14.1 times estimated earnings yesterday, compared with 14.5 times for the Standard & Poor’s 500 Index and 13 times for the Stoxx Europe 600 Index.

Regional Gauges

Japan’s Topix Index rose 0.7 percent, while South Korea’s Kospi Index (KOSPI) jumped 1.3 percent. Australia’s S&P/ASX 200 Index gained 1.1 percent today and New Zealand’s NZX 50 Index increased 0.7 percent. Hong Kong’s Hang Seng Index climbed 0.8 percent. Markets in mainland China are closed for a holiday.

Futures on the S&P 500 Index (SPX) slipped less than 0.1 percent. The measure rose 0.7 percent to a record yesterday as pending sales of homes climbed 1.5 percent in March amid optimism central banks will maintain stimulus plans.

The European Central Bank will cut its benchmark interest rate to a record low of 0.5 percent on May 2, according to the majority of economists in a Bloomberg survey, while the Federal Reserve may consider renewing its commitment to bond-buying at a two-day meeting starting today.

Most exporters advanced. Samsung Electronics gained 3.2 percent to 1.529 million won inSeoul. Hon Hai Precision Industry Co. (2317), which counts Apple Inc. as it biggest customer, added 1.2 percent to NT$76.40 in Taipei. Advantest Corp., the world’s largest maker of memory-chip testers, rose 4 percent to 1,469 yen in Tokyo.

Unilever India

Hindustan Unilever Ltd. surged 16 percent to 575.75 rupees, the biggest advance on the MSCI Asia Pacific Index. Unilever Plc, the world’s second-largest consumer goods company, will spend up to 292.2 billion rupees ($5.4 billion), or 600 rupees a shares, to boost its stake in its Indian unit to help offset slower European growth.

Mitsui O.S.K. Lines Ltd. (9104), operator of the world’s largest merchant fleet, jumped 5.1 percent to 410 yen in Tokyo. The company said it expects to post a net profit of 50 billion yen ($510 million) in the year ending March 31, 2014, compared with a net loss of 178.8 billion yen in the previous year. The profit forecast for the current fiscal year surpassed the 23 billion yen average estimate by 15 analysts compiled by Bloomberg.

ANZ Bank climbed 5.3 percent to A$31.68 in Sydney, heading for its highest close since at least 1969. Cash earnings, which exclude one-time items, jumped to A$3.18 billion ($3.29 billion) in the six months ended March 31, according to a stock exchange filing. The Melbourne-based lender boosted its interim dividend to 73 Australian cents a share and said the near-term payout ratio will likely be at the upper end of its 65 percent to 70 percent target.

Earnings Performance

Of the 211 companies on the Asia-Pacific gauge that have reported quarterly earnings since April 1, and for which Bloomberg has estimates, 96 have missed projections.

Honda slipped 3.1 percent to 3,885 yen. Net income will probably rise 58 percent to 580 billion yen ($5.9 billion) in the 12 months ending March 2014, the Tokyo-based automaker said April 26.

Fanuc Corp. (6954), the No. 1 maker of industrial robots, tumbled 7.2 percent to 14,450 yen, the biggest decline since September 2011 and the No. 1 drag on the Nikkei 225 Stock Average. The company forecast net income and operating profit to fall 39 percent in the first half.

To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

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