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Asian stocks rise on Japan, US economic reports

Asian stocks rise on Japan, US economic reports
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First Published: Fri, Mar 30 2007. 09 04 AM IST
Updated: Fri, Mar 30 2007. 09 04 AM IST
Sydney: Asian stocks rose after government reports boosted confidence in the outlook for growth in the US and Japan, the world’s biggest economies. Honda Motor Co. and Mizuho Financial Group Inc. paced gains.
“Domestic sectors may look good because of the rising of the Japanese economy and spending in 2007,’’ said Yuuki Sakurai, who helps manage $32 billion (Rs1,39,103 crore) at Tokyo-based Fukoku Mutual Life Insurance Co.
The Morgan Stanley Capital International Asia-Pacific Index climbed 0.6% to 145.29 as of 11:08 am in Tokyo. The benchmark is heading for a 3.4% gain this quarter.
Japan’s Nikkei 225 Stock Average climbed 0.4% to 17,338.27, while the broader Topix index added 0.5%. Markets elsewhere rose or were little changed.
Woodside Petroleum Ltd. led energy stocks higher after crude oil prices rose for a ninth day. Fairfax Media Ltd paced gains by Australian media companies after the government said laws removing most ownership restrictions will take effect 4 April, paving the way for mergers and acquisitions in the industry.
US stocks climbed in New York after the world’s biggest economy expanded at a faster-than-expected pace. The US is Asia’s biggest export market. A measure of Japanese industrial production fell less than expected and household spending jumped, boosting confidence in the outlook for the region’s largest economy.
Industrial Production
Honda, Japan’s No. 2 automaker, added 2.5% to 4,170 yen. Sony, the second-largest consumer electronics maker globally, advanced 1% to 6,040 yen. Hyundai Motor Co., South Korea’s biggest automaker, gained 1.1% to 66,200 won.
US gross domestic product expanded at a 2.5% annualized rate last quarter, the Commerce Department said yesterday in its final reading of the figure. That was more than the median estimate of 2.2% growth by 75 economists in a Bloomberg survey.
Adding to investor confidence in the US economy, jobless claims dropped more than forecast to 308,000, while core personal consumption, a price gauge, was revised lower to 1.8% from a previous reading of 1.9%.
Mizuho Financial, Japan’s No. 2 bank, climbed 1.5% to 755,000 yen. Nippon Telegraph & Telephone Corp., the country’s largest telephone company, jumped 4.1% to 635,000 yen.
Japanese industrial production 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 a higher-than-estimated 1.3%, a second month of increases, the statistics bureau said, while the unemployment rate remained unchanged at 4%, in-line with economist estimates. Household spending dropped every month of 2006 on a year-on-year basis.
Energy, Media
Woodside Petroleum, Australia’s biggest oil producer after BHP Billiton Ltd, climbed 1% to A$39.93. Santos Ltd, the nation’s third-biggest producer, rose 1.8% to A$10.18. Inpex Holdings Inc., Japan’s largest oil explorer, gained 2.2% to 1.02 million yen.
Crude oil rose 3% to settle at $66.03 a barrel in New York. It was the highest closing price since 8 September. Oil was recently at $66.65 in after-hours trading.
In Australia, Fairfax Media, the owner of the Australian Financial Review, jumped 4.9% to A$4.97. Publishing & Broadcasting Ltd, which partly owns the Channel Nine network, climbed 4.4% to A$19.87. Southern Cross Broadcasting Australia Ltd., which owns a network of radio and television stations, advanced 4.5% to A$16.65.
Parliament passed the laws in October, triggering a rush in media transactions. Under the new laws, 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 government announced late yesterday the new laws will take effect on 4 April after the stock market had closed.
“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.’’
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First Published: Fri, Mar 30 2007. 09 04 AM IST
More Topics: Money Matters | Equities |