Asian stocks rose, lifting the MSCI Asia-Pacific Index to a two-week high, as faster-than-estimated growth in US manufacturing supported confidence in global economic growth.
Honda Motor Corp., which gets 46 per cent of its sales from North America, rose 1.6 per cent in Tokyo. Ping An Insurance (Group) Co. jumped 5.8 per cent in Hong Kong on plans to merge its bank unit with Shenzhen Development Bank Co. GS Yuasa Corp., a Japanese car battery maker, gained 4.7 per cent after Credit Suisse Group AG upgraded the stock. Jiangxi Copper Co. gained 2.6 per cent in Hong Kong as commodity prices advanced.
The MSCI Asia Pacific Index gained 0.6 per cent to 118.77 as of 1:05 p.m. in Tokyo, set for its highest close since August 19. The gauge advanced 1.3 per cent yesterday after reports showed China's manufacturing and Australia's gross domestic product grew faster than economists estimated.
``The US manufacturing data served to allay fears of a double-dip recession,'' said Tim Schroeders, who helps manage about $US1 billion at Pengana Capital in Melbourne. ``Yesterday's manufacturing report out of China was better than expected and Australia's buoyant GDP data also served to build investor confidence.''
Japan's Nikkei 225 Stock Average gained 0.4 per cent, Hong Kong's Hang Seng Index jumped 1.3 per cent and Taiwan's Taiex Index climbed 0.8 per cent. South Korea's Kospi Index rose 0.3 per cent. Australia's S&P/ASX 200 Index advanced 0.6 per cent.
`Leading indicator'
Futures on the Standard & Poor's 500 Index slid 0.3 per cent today. The index climbed 3 per cent yesterday, the biggest gain since July 7, after the ISM's factory index rose to a three- month high of 56.3 in July. Readings greater than 50 signal growth, and the figure was projected to drop to 52.8, according to the median forecast of economists in a Bloomberg News survey.
In Tokyo, Honda rose 1.6 per cent to 2,853 yen. James Hardie Industries SE, the biggest seller of home siding in the US, advanced 1.7 per cent to $5.34 in Sydney.
``Manufacturing is a good leading indicator,'' said Matt Riordan, who helps manage about $5 billion at Paradice Investment Management in Sydney. ``An increase shows manufacturers are receiving good signals from their customers. If higher levels can be maintained, it will ultimately feed through to better employment, which then leads to a cycle of economic improvement.''
Weaker yen
Japanese exporters also gained as the yen retreated against the euro. Sony Corp., an electronics maker that derives 20 per cent of its sales from Europe, rose 0.8 per cent to 2,395 yen. Nissan Motor Corp., which gets about 14 per cent of sales from Europe, jumped 2.8 per cent to 663 yen.
The yen depreciated to as low as 108.62 against the euro from 107.28 at the close of stock trading in Tokyo. A weaker yen helps to boost income at Japanese companies when overseas revenue is converted into their home currency.
The MSCI Asia Pacific Index has declined 2.9 per cent from a three-month high on Aug. 6 as the yen's advance to a 15-year high against the dollar and disappointing US data fueled global growth concerns. US government reports showed purchases of existing houses plunged by a record 27 per cent in July, while orders for durable goods increased less than forecast in the same month.
Stocks on the MSCI gauge are valued at an average 13.6 times estimated earnings, compared with 12.9 times for the S&P 500 Index and 11.6 times for the Stoxx Europe 600 Index.
Raw-material producers
In Hong Kong, Ping An jumped 5.8 per cent to HK$US68.10, trading for the first time in the city since June 29. The insurer, China's second largest, will pay 29.1 billion yuan ($4.6 billion) for a stake that will give it control of Shenzhen Development Bank. Shares of Shenzhen Development Bank rose 3.3 per cent to 18.09 yuan.
GS Yuasa climbed 4.7 per cent to 554 yen, extending yesterday's 6.9 per cent surge. Credit Suisse Group AG raised the stock to ``outperform'' from ``neutral.'' Phison Electronics Corp. surged 6.9 per cent to $NT146.5 in Taipei trading after Morgan Stanley raised the stock to ``equal-weight'' from ``underweight.''
Raw-material producers advanced after the London Metal Exchange Index of six metals including aluminum and copper advanced 2.3 per cent yesterday. Three-month copper futures on the LME gained as much as 0.5 per cent today and traded near a four-month high. Crude-oil futures rose 2.8 per cent yesterday in New York, its biggest gain since Aug. 2.
Jiangxi Copper, China's largest producer of the metal, gained 2.6 per cent to $HK17.60 in Hong Kong. BHP Billiton Ltd., the world's largest mining company, rose 0.9 per cent to $38.26. Rio Tinto Ltd., the world's third-biggest mining company, climbed 1.2 per cent to $73.08. Inpex Corp., Japan's No. 1 oil explorer, increased 1.5 per cent to 395,000 yen.
Bloomberg News
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