Asian stocks poised for biggest weekly gains

Asian stocks poised for biggest weekly gains
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First Published: Fri, Mar 23 2007. 08 52 AM IST
Updated: Fri, Mar 23 2007. 08 52 AM IST
Tokyo/ Kuala Lumpur: Asian stocks were poised for the biggest weekly advance in seven months. Mizuho Financial Group Inc. led gains among Japanese companies that rely on the domestic economy after a report showed the country’s overall land prices rose for the first time in 16 years.
“The land-price report raised expectations that Japan’s economy, including areas outside Tokyo, will have solid growth,’’ said Naoki Fujiwara, who oversees the equivalent of $720 million (Rs3,143 crore) at Shinkin Asset Management Co. in Tokyo.
Woodside Petroleum Ltd and Mitsubishi Corp. advanced after crude oil prices neared $62 a barrel. Technology shares fell, led by Benq Corp., on a report that the company may face claims stemming from its bankrupt German mobile-phone unit and as Palm Inc. yesterday reported a drop in quarterly profit, adding to disappointing earnings forecasts by Motorola Inc. a day earlier.
The Morgan Stanley Capital International Asia-Pacific Index gained 0.1% to 145.72 at 11:02 am in Tokyo, set to close at the highest since 27 February. For the week, the gauge is heading for a 3.1% rise, the most since the five days to 18 August.
Japan’s Nikkei 225 Stock Average climbed 0.2% to 17,453.53, while the broader Topix index rose 0.4%. Sony Corp. advanced after the shares were rated “overweight’’ in new coverage at Prudential Equity Group LLC.
Markets open for trading elsewhere in the region fell, except in Australia, Taiwan and Malaysia.
Mizuho, Japan’s second-biggest lender by assets, advanced 1.4% to 783,000 yen. Central Japan Railway Co., the nation’s No. 2 train operator, jumped 1.4% to 1.42 million yen. Sumitomo Realty & Development Co., the country’s third-biggest property developer, added 1.3% to 4,650 yen.
Property prices rose nationwide an average 0.4% in the year ending 31 December, the Ministry of Land, Infrastructure and Transport said in report released yesterday, after markets closed. Commercial land prices rose 2.8% and residential prices gained 0.1%.
“Oil-related shares may lead today’s gain after crude prices jumped above $61,’’ said Soichiro Monji, who helps oversee about $47 billion at Daiwa SB Investments Ltd in Tokyo.
Japan Petroleum Exploration Co., the nation’s second-biggest oil explorer, climbed 0.1% to 8,140 yen. It said yesterday the company and Mitsubishi Corp. will together spend $400 million in the Kangean area in East Java to acquire exploration rights held by PT Energi Mega Persada.
Production, mostly gas, will be increased to 60,000 barrels of oil equivalent a day from 10,000 barrels within three to five years, Yuji Tanahashi, chief executive of Japan Petroleum said to reporters in Jakarta yesterday.
Sony, the world’s biggest maker of video-game players, rose 0.8% to 6,230 yen. Prudential said it gave the “overweight’’ rating, its highest ranking, as margins should continue to improve. The brokerage also gave Sony’s American depositary shares a price target of $62, 17 percent higher than the closing level of $52.83 yesterday. Sony is releasing its PlayStation 3 console in Europe today.
Singapore
The Straits Times Index slid for the first time in five days, trimming its biggest weekly advance in more than 3 1/2 years. CapitaLand Ltd led declines on concern recent gains were excessive.
The Straits Times lost 8.12, or 0.3%, to 3211.39 as of 10:40 am local time, after yesterday posting its biggest advance since 8 March. More than two stocks fell for each one that gained.
CapitaLand, the city’s largest developer, fell 5 cents, or 0.7%, to S$7.70. The stock jumped 12% this week. Venture Corp., the city’s largest maker of electronics for customers including Hewlett-Packard Co., lost 20 cents, or 1.3%, to S$14.80. The stock yesterday climbed to the highest since September 2005.
City Developments Ltd, Singapore’s second-biggest property company, fell 20 cents, or 1.4%, to S$14.20. The shares yesterday rose 5.9%, the biggest gain since 20 July 2005.
Singapore Airlines, the world’s largest carrier by market value, lost 10 cents, or 0.6%, to S$17.30. Fuel expenses accounted for almost 37% of total expenditure in the fiscal third quarter. The company yesterday also said it plans to raise a ticket surcharge on 1 April.
ComfortDelGro Corp., the operator of the world’s second- largest fleet of buses and taxis, lost 5 cent, or 2.6%, to S$1.85. Neptune Orient Lines Ltd, which operates Asia’s fourth- largest container shipping line, slid 2 cents, or 0.6%, to S$3.22.
Crude oil jumped 3.5% to $61.69 a barrel in New York, the biggest one-day gain since 8 February. It was recently at $61.85 in after-hours trading.
Banyan Tree Hotels, the owner and manager of hotels and resorts, rose 7 cents, or 3.4%, to S$2.14. UBS AG raised its share-price forecast to S$2.50 from S$1.60, citing the company’s expansion plans in Vietnam, China and Mexico.
Jurong Technologies Industrial Corp., which counts Motorola among its customers, slumped 5.7% to 75 Singapore cents.
Malaysia
The Kuala Lumpur Composite Index rose 6.94, or 0.6%, to 1228.66 at 9:54 am local time, adding to a six-day, 4.7% rally. The measure is set for its biggest weekly gain since the week ended 9 January 2004. The smaller Second Board Index added 0.1% to 97.22. The FTSE Bursa Malaysia Emas Index gained 0.6% to 8,195.43.
SP Setia, Malaysia’s biggest property developer, gained 35 sen, or 4.9%, to 7.55 ringgit. Glomac Bhd. added 5 sen, or 3.3%, to 1.58 ringgit, headed for its seventh day of gains. Analyst Kamarulzaman Hassan from TA Securities in Kuala Lumpur raised his rating on SP Setia and Glomac to a “hold” from “sell.” UEM World Bhd., which is developing Malaysia’s biggest property project in the southern state of Johor, surged 18 sen, or 4.5%, to 4.20 ringgit.
The tax on capital gains from property investments will be lifted from 1 April to encourage buyers, Prime Minister Abdullah Ahmad Badawi said in a speech yesterday at a conference.
The current capital gains tax on property is 30% within the first two years, falling to 5% by the fifth year, according the Inland Revenue Board’s Web site. For foreigners, the tax starts at 30% for the first five years, and drops to 5% in the sixth and subsequent years.
Tanjong Plc., a betting and power generation company, jumped 40 sen, or 2.7 %, to 15.50 ringgit, after fourth-quarter profit rose 75% from a year earlier to 151.2 million ringgit, helped by contributions from its Egyptian power plants.
South Korea
South Korean stocks dropped, reversing an earlier gain. Oil-dependent companies such as Korea Electric Power Corp. slid after crude oil rose by the most in two weeks, raising concern that fuel costs will squeeze profit.
The Kospi index fell 2.49, or 0.2%, to 1446.04 as of 10:13 am in Seoul. The measure, which rose as much as 0.4% earlier, is set to gain 1.2% for the week. The Kosdaq retreated 0.8% to 640.59. Kospi 200 futures expiring in June were little changed at 188.55, while the underlying index dropped 0.1% to 186.88.
Korea Electric, which supplies almost all the power in the country, slid 350 won, or 0.9%, to 37,650. Korean Air Lines Co., the biggest South Korean carrier, lost 350 won, or 0.9%, to 37,400.
Asiana Airlines Inc., the second-largest South Korean carrier, retreated 160 won, or 2.3%, to 6,400.
LG Electronics Inc., South Korea’s second-largest electronics maker, fell 0.5% to 59,500 won.
Disappointing Earnings
Benq, Taiwan’s biggest maker of branded consumer electronics, slumped 3.9% to NT$12.50. The company may face 500 million euros ($667 million) in claims, the Taiwan Economic Daily News said, citing Martin Prager, the German unit’s insolvency administrator.
Prager said he’ll soon file the claim to the Taiwanese parent, the report said. Benq Corp. has not received any claims from Benq Mobile or the insolvency administrator so far, Jean Hsu, a Benq spokeswoman in Taipei, said today.
The company reported a record annual loss earlier this week after its 2005 purchase of Siemens AG’s mobile-phone unit failed to raise profit or sales. The German unit is now being liquidated.
Palm, the maker of the Treo mobile phone and e-mail device, said third-quarter profit dropped 61 percent from a year earlier to $11.8 million because of advertising and development spending to stem the loss of customers to Research In Motion Ltd’s BlackBerry.
Shares of Motorola, the world’s second-biggest maker of mobile phones, tumbled 6.6% yesterday. The company said profit and sales will be “substantially’’ below its forecast this year because of plunging mobile-phone prices, signaling a turnaround may take longer than investors anticipated.
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First Published: Fri, Mar 23 2007. 08 52 AM IST
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