Singapore/Tokyo: Asian stocks snapped a two-day loss as the yen fell to a record low against the euro, boosting the value of Japanese exporters’ European sales. Canon Inc. and Toyota Motor Co. gained.
“Automaker and technology stocks will benefit from the view that the trend of a weaker yen won’t change for at least another year,’’ said Masanaga Kono, who helps manage about $14 billion (Rs59,516 crore) at Societe Generale Asset Management (Japan) Co. in Tokyo. “I changed my stance on technology stocks to neutral from bearish on the expectation their earnings may improve this business year.’’
BHP Billiton Ltd led commodity producers higher as prices of copper and gold climbed. Takeda Pharmaceutical Co. rose after Merck & Co. reported a profit that beat some analyst estimates, spurring a rally in U.S. health-care stocks.
The Morgan Stanley Capital International Asia-Pacific Index added 1.1% to 147.98 as of 10:45 am in Tokyo, ending a two-day, 1.1% slide. The measure was set for its biggest advance since 4 April. All 10 industry groups gained.
Japan’s Nikkei 225 Stock Average climbed 1.7% to 17,660.81, set to gain the most since 8 March, while the broader Topix index added 1.2%. Markets gained elsewhere in the region, with benchmarks in Australia, China and Malaysia heading for record highs. Thailand was closed for a holiday.
U.S. shares posted their first back-to-back weekly gains since January on earnings from Merck and McDonald’s Corp. that topped analyst estimates and speculation that takeovers will accelerate. The Standard & Poor’s 500 Index added 0.4%, recouping all its losses from the 27 February global equities rout.
Canon, the world’s biggest digital camera maker, jumped 1.6% to 6,550 yen. It generates more than 75% of its revenue overseas. Toyota Motor Corp., the world’s biggest automaker by value, rose 0.6% to 7,190 yen. Toyota made about 63% of its total sales outside Japan last year.
The yen dropped to a record low of 161.61 against the euro as of 9:18 am compared with 161.32 last week. A weaker yen means Japanese exporters get more for their overseas sales when converted back to local currency while their products become more competitive.
“Exporter shares should react positively’’ to the weaker yen, said Masanobu Takahashi, a strategist at Ichiyoshi Securities Co. in Tokyo.
Nintendo Co., maker of the Wii video-game console, jumped 2.8% to 37,300 yen. The shares were rated “overweight’’ in new coverage by Eiji Maeda, an analyst at JPMorgan Securities Japan Co.
BHP, the world’s biggest mining company, rose 1.2% to A$30.20. Rio Tinto, the third-largest, added 1.6% to A$83.52. Nippon Mining Holdings Inc., Japan’s biggest copper producer, rose 0.8% to 999 yen.
Copper prices rose for the sixth week in a row last week, gaining 25% in six weeks, the longest rally in almost a year. Gold futures for June delivery rose 20 cents to $690.10 an ounce on the New York Mercantile Exchange, after cementing a six-week climb last week.
The MSCI Asia-Pacific Healthcare Index jumped 2.2%, the biggest gain among the regional measure’s 10 industry groups.
Merck shares jumped 8.3% on 13 April after the company last week said first-quarter earnings increased 13% to 78 cents a share. The average estimate of 16 analysts in a Bloomberg News survey was for earnings of 63 cents a share.
Takeda, Japan’s largest drugmaker, rose 2.3% to 7,960 yen. The company may report a 5% profit increase for the year ended 31 March because of rising sales in the U.S. for its diabetes treatment, the Nikkei newspaper reported on 12 April.
Daiichi Sankyo Co., Japan’s second-largest drugmaker, jumped 3% to 3,770 yen. Shionogi & Co., creator of the Crestor cholesterol pill, added 4% to 2,340 yen.