Asian stocks rose, driving the MSCI Asia Pacific Index higher for the third straight day, as better- than-estimated US home sales and earnings reports boosted investor confidence.
James Hardie, the biggest seller of home siding in the US, jumped 4.6 per cent in Sydney. Sumitomo Mitsui Financial Group rose 3.2 per cent in Tokyo after its investment-banking unit reported higher earnings. Seiko Epson rose 4.2 per cent in Tokyo after the Nikkei newspaper said the printer maker may have posted its first operating profit in two years in the first quarter. Singapore Airlines rose 1.6 per cent on better-than-estimated earnings.
''Strong earnings and better economic news have reduced fears of a double-dip recession,'' said Nader Naeimi, a Sydney-based strategist at AMP Capital Investors, which manages about $US90 billion. ''After a spate of worse than expected data out of the US, the market is prepared to pay more attention to good news.''
The MSCI Asia Pacific Index gained 0.7 per cent to 118.77. The gauge has slumped 8 per cent from its high this year on April 15 on concern Europe's debt crisis and Chinese steps to curb property prices will slow global growth.
Japan's Nikkei 225 Stock Average advanced 0.3 per cent. Australia's S&P/ASX 200 Index climbed 0.4 per cent. South Korea's Kospi increased 0.2 per cent. China's Shanghai Composite Index lost 0.4 per cent.
Futures on the US Standard & Poor's 500 declined 0.1 per cent. The gauge gained 1.1 per cent yesterday after the report on June home sales and after FedEx, the second-largest US package-shipping company, boosted its profit forecast.
US sales
James Hardie surged 4.6 per cent to $6.84. Nissan, which gets a third of its revenue from North America, increased 1 per cent to 635 yen. Hyundai, which derives 14 per cent of its sales in North America, advanced 2.5 per cent to 143,500 won in Seoul.
New US home purchases increased 24 per cent from May to an annual pace of 330,000, the Commerce Department said yesterday. The median forecast of economists in a Bloomberg News survey was for an advance of 3.3 per cent to 310,000. A government report later today will show US durable goods orders gained 1 per cent from the previous month, after falling 0.6 per cent in May, according to a Bloomberg News survey.
Lower valuations
The home-sales data helped ease concerns the world's biggest economy is stalling. Sales at US retailers declined in June for a second month, the Commerce Department reported on July 14. Home-builder confidence dropped this month to the lowest level since April 2009, National Association of Home Builders/Wells Fargo data on July 19 showed.
Speculation economic growth may falter dragged down the MSCI Asia Pacific Index by as much as 9.6 per cent this year, cutting the average price of stocks in the gauge to the lowest level since December 2008. The index's companies now trade at 14.2 times estimated profit, compared with 13.5 times for the S&P 500 Index and 11.9 times for the Stoxx Europe 600 Index.
In Tokyo, Seiko Epson jumped 4.2 per cent to 1153 yen. The company may have posted its first group operating profit in two years in the quarter ended in June on rising demand for printers and electronic parts, the Nikkei newspaper said.
Kao Corp increased 1.4 per cent to 2118 yen after the toiletry maker said net income for the quarter ended June 30 rose 5.7 per cent, boosted by an increase in sales.
Singapore Airlines
Sumitomo Mitsui, Japan's second-largest publicly traded bank, gained 3.2 per cent to 2598 yen. Nikko Cordial Securities, the investment-banking unit of Sumitomo Mitsui, said first-quarter profit rose 24 per cent on higher commissions and trading activity.
Singapore Air, the world's second-largest carrier by market value, gained 1.6 per cent to S$15. The carrier's first-quarter net income of S$252.5 million, beating the S$162.4 million average analyst estimate compiled by Bloomberg.
''Corporate earnings are good,'' said Fumiyuki Nakanishi, a strategist at Tokyo-based SMBC Friend Securities. ''Companies which reported strong earnings should be targets'' for investors to buy.
In Sydney, Wesfarmers, Australia's No. 2 retailer, advanced 0.9 per cent to $30.34 in Sydney after having its rating raised to ''neutral'' from ''underperform'' at Credit Suisse. An improving retail industry will support the company's shares, analysts at the brokerage wrote in a report dated today.