Stuart Kelly and Kotaro Tsunetomi, Bloomberg
Sydney/Tokyo: Asian stocks rose, led by Mizuho Financial Group Inc., after industrial production and household spending reports in Japan boosted confidence in the growth outlook for the region’s biggest economy.
“There’s a sense of recovery there and that’s providing support to the market,” said Hideyuki Ookoshi, who oversees $365 million (Rs1,588 crore) at Chiba-Gin Asset Management Co. in Tokyo. “If production recovers, the Japanese economy could take off from its current plateau around mid-year.”
The Morgan Stanley Capital International Asia-Pacific Index climbed 0.2% to 144.73 as of 7:25 pm in Tokyo. The benchmark has risen 3% this year, gaining for three straight quarters.
Japan’s Nikkei 225 Stock Average rose 0.1% to 17,287.65, while the broader Topix index climbed 0.2%. Markets advanced, except in Hong Kong, China, Thailand, Sri Lanka and New Zealand. The Philippine Stock Exchange Index added 1.6%, the most in the region.
Inpex Holdings Inc. led energy stocks higher after crude oil prices rose for a ninth day. Australia’s Fairfax Media Ltd. gained on speculation of industry mergers after ownership restrictions are removed next week. Posco led South Korean steelmakers higher on expectations that rising prices for the alloy will boost profit.
U.S. stocks climbed yesterday after jobless claims unexpectedly fell and a government report showed the world’s biggest economy grew at a faster pace last quarter than some economists estimated.
Mizuho Financial, Japan’s No. 2 bank, climbed 2% to 759,000 yen. Nippon Telegraph & Telephone Corp., the country’s biggest telephone company, jumped 2.1% to 623,000 yen. Mitsui Fudosan Co., the largest property developer, climbed 2.1% to 3,460 yen.
Industrial production in Japan, the world’s second-largest economy, dropped a seasonally adjusted 0.2% in February from the previous month, the trade ministry said today. Economists surveyed by Bloomberg News had forecast a 0.7% drop. Inventories dropped 0.4%.
Household spending rose 1.3%, a second month of increases, Japan’s statistics bureau said. That was higher than the 0.6% median estimate of 29 economists in a Bloomberg survey. Household spending dropped every month of 2006 on a year- on-year basis.
“Domestic sectors may look good because of the rising of he Japanese economy and spending in 2007,” said Yuuki Sakurai, who helps manage $32 billion at Tokyo-based Fukoku Mutual Life Insurance Co.
Inpex Holdings, Japan’s largest oil explorer, gained 2.2% to 1.02 million yen. PetroChina Co., China’s largest oil producer, climbed 1.8% to HK$9.27 in Hong Kong. Santos Ltd, Australia’s third-biggest producer, rose 1.5% to A$10.15.
Crude oil rose 3% to settle at $66.03 a barrel in New York, after Iran, the Middle East’s second-largest exporter, refused to release 15 British servicemen, fueling concern supplies will be disrupted. It was the highest closing price since 8 September. Oil was recently at $66.19 in after-hours trading.
In Australia, Fairfax Media, the owner of the Australian Financial Review, jumped 5.1% to A$4.98. Publishing & Broadcasting Ltd, which partly owns the Channel Nine network, climbed 4.3% to A$19.85.
Parliament passed new laws in October abolishing 20-year-old rules stopping overseas investors from owning more than 25% of a city newspaper publisher and 15% of a TV network will be abolished. The new laws will take effect on 4 April, the government said after the market closed yesterday.
“Some of these stocks, like Fairfax, are now fairly attractive,” said Richard Wallace, who manages about $125 million at Wallace Funds Management in Sydney. “The announcement of an actual date for the ownership changes has spurred investors to buy media stocks across the board in anticipation of takeovers.”
Posco, the world’s third-biggest steelmaker, rose 1.7% to a record 395,000 won. Hyundai Steel Co., South Korea’s second- largest steelmaker, climbed 0.9% to 35,800 won. Dongkuk Steel Mill Co., the third biggest, added 0.2% to 26,000 won.
UBS AG lifted its 12-month price estimate for Dongkuk Steel by 15% to 31,000 won, in a report today. Steel prices are likely to keep rising this year, which will drive profit growth, wrote Son Yong Suk, a Seoul-based analyst.
Samsung, the world’s biggest computer-memory maker, slid 1.1% to 563,000 won. Citigroup cut its estimate for first- quarter earnings by 11%, in a report today, citing a “drastic fall” in prices for dynamic random access memory chips, or DRAM.
Spot prices for the benchmark 512-megabit DRAM chip have plunged 54% this year, according to Dramexchange.com, Asia’s biggest spot market for chips. Samsung had forecast in January a “high single-digit” percentage price decline for this quarter.
China Unicom Ltd, the nation’s second-biggest mobile-phone operator, fell 0.5% to HK$11.26 in Hong Kong after JPMorgan Chase & Co. lowered the stock to “underweight” from “neutral.” Profit this year will grow less than that of larger rival China Mobile Ltd, according to the brokerage’s daily note.
— With additional reporting by Patrick Rial in Tokyo and Kyung Bok Cho in Seoul