×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Asian stocks gain despite US housing slump

Asian stocks gain despite US housing slump
Comment E-mail Print Share
First Published: Fri, Aug 31 2007. 12 52 AM IST
Updated: Fri, Aug 31 2007. 12 52 AM IST
Asian stocks advanced after Esprit Holdings Ltd, which has headquarters both in Hong Kong and Germany, and China-based CNOOK Ltd reported profit that beat estimates, reducing concern earnings in the region will be hampered by a slump in the US housing ­market.
Esprit, which sells clothes in more than 40 countries, registered record profit this past quarter. Samsung Electronics Co. Ltd paced gains among semiconductor stocks after Seagate Technology Llc., the world’s biggest maker of hard disk drives, boosted revenue forecasts. Stocks of BHP Billiton Ltd, Australia’s biggest oil producer, climbed after the price of crude gained the most in a month.
“Earnings we’ve seen so far are upbeat, fuelling positive sentiment in the market,” said Mona Chung, who helps manage $2.5 billion (Rs10,300 crore) at Daiwa Asset Management Ltd in Hong Kong. “There’s a strong growth story in Esprit and we believe it’s sustainable.”
The Morgan Stanley Capital International Asia-Pacific Index climbed 0.7% to 148.94 at in Tokyo on Thursday, rebounding from a 1.6% decline on Wednesday. Technology and materials stocks accounted for 36% of Thursday’s gain.
The Nikkei 225 Stock Average added 0.9%, while Hong Kong’s Hang Seng Index rose 2.3%.
A decline in the yen helped lift Japanese exporters Sony Corp. and Nintendo Co. Ltd.
Ayala Land Inc. led gains in the Philippines, the region’s best-performing market, after the government reported the fastest economic growth in almost two decades. Benchmarks advanced across the region, except in Singapore, Thailand and Sri Lanka.
Stocks of Industrial & Commercial Bank of China Ltd rose after it bought Macau’s Seng Heng Bank. Stocks of Australian bookmakers Tabcorp Holdings Ltd and Tattersalls Ltd fell after a racehorse contracted equine influenza, threatened gaming.
Esprit’s stocks jumped 6.7% to HK$111.70 on Thursday. Full-year profit rose 39% to HK$5.2 billion on higher sales in Europe, beating the HK$4.8 billion estimate analysts predicted in a Bloomberg survey. Credit Suisse Group raised its share price target on Esprit by 18%, a report on Thursday said.
Higher earnings are helping to ease concern that a housing slump in the US, the region’s biggest export market, will hurt stocks. Concern about losses on US subprime, or higher risk mortgages, triggered a sell-off last month that erased more than $5.5 trillion from global ­equities.
“Strong corporate earnings provided a safety net for investors in the face of turmoil in the US financial market,” said Phil Chen, who manages $154 million at Grand Cathay Securities Investment Trust Co. in Taipei.
Stocks of CNOOK, China’s largest offshore oil producer, climbed 4% on Thursday to HK$9.22 in Hong Kong. The company said first-half profit declined 11%—less than analysts estimated, as it reined in operating costs.
Net income slid to 14.6 billion yuan ($1.9 billion) from 16.3 billion yuan a year earlier, the company said on Thursday, reflecting lower average oil prices. Analysts in a Bloomberg survey had estimated a median 15% decline.
Stocks of Uni-President Enterprises Corp., Taiwan’s biggest processed food maker, jumped 6.9% to NT$36.25 on Thursday—a record.
Uni-President’s second quarter profit more than doubled from a year earlier to NT$2.3 billion ($70 million).
Intel Corp. and Dell Inc. rallied following Seagate’s announcement, contributing to a 2.2% jump in the US Standard & Poor’s 500 Index on Wednesday. Profit in the three months ending 28 September will be as much as 61 cents a share, compared with a previous projection of as much as 39 cents, Seagate said.
Earnings growth at technology companies in the S&P 500 next year is expected to be the highest among 10 industry groups, according to a Bloomberg analyst survey compiled on 24 August. Stocks of BHP Billiton added 1.9% to A$37.75 on Thursday. Stocks of Rio Tinto Group, the world’s third largest mining company, gained 1.1% to A$91.10.
PetroChina Co. Ltd, China’s largest oil producer, saw its stocks climb 2.2% to HK$11.38 in Hong Kong on Thursday.
A measure of six metals traded on the London Metal Exchange, including copper and nickel, climbed 0.6% on Wednesday. Crude oil in New York climbed 2.5% to $73.51—the biggest gain since 27 July. Japan’s currency, the yen, was at 115.30 to the dollar and 157.47 versus the euro at the close of stocks trading in Tokyo. BLOOMBERG
feedback@livemint.com
Comment E-mail Print Share
First Published: Fri, Aug 31 2007. 12 52 AM IST