BLBG: Asian Stocks Gain for First Time in Five Days; Fujitsu Climbs
Asian stocks gained for the first time in five days, as a rebound in oil boosted energy producers and technology companies rose on speculation mergers and cost- cutting measures will bolster profits.
Cnooc Ltd., China’s biggest offshore oil producer, rose 4.6 percent in Hong Kong as crude oil climbed for the first time in six days. Toshiba Corp. and Fujitsu Ltd., Japan’s No. 2 personal computer maker, gained more than 3 percent in Tokyo as the companies neared an agreement on talks to combine their hard-disk drive businesses. Sony Corp. added 5 percent after Merrill Lynch & Co. raised its target price, saying the company’s planned reorganization may boost competitiveness.
“Whether companies can turn around later this year depends largely on restructuring and cost cutting moves when the weather is stormy,” said Naoki Fujiwara, chief fund manager at Shinkin Asset Management Co., which oversees the equivalent of $6.1 billion.
The MSCI Asia Pacific Index advanced 1.2 percent to 86.92 as of 1:37 p.m. in Tokyo. About two stocks rose for each that dropped and all 10 industry groups increased.
The gauge slumped 7 percent during the previous four sessions amid growing concern the global recession will fuel losses for the region’s manufacturers. Analysts have slashed their profit estimates for companies included in MSCI’s Asian index by 40 percent since a peak in April, according to data compiled by Bloomberg.
Growth in the global economy will slow to 2.2 percent this year, a rate “equivalent to a global recession,” the International Monetary Fund said in November.
Japan’s Nikkei 225 Stock Average added 0.4 percent to 8,449.53, led by Sony. All other benchmark indexes rose apart from Malaysia and the Philippines.
U.S. Futures
The Standard & Poor’s 500 Index edged up 0.2 percent in the U.S. yesterday as investors bought up shares trading at low valuations and avoided industrial companies. Futures on the S&P rose 0.6 percent in trading today.
Crude oil for February delivery broke a five-day losing streak yesterday with a 0.5 percent gain in New York as Saudi Arabia Oil Minister Ali al-Naimi said his country will make deeper production cuts than previously announced. A measure of six metals traded in London climbed 2.6 percent, partially offsetting a 4.9 percent decline the previous day.
Cnooc advanced 4.6 percent to HK$7.21. Woodside Petroleum Ltd., Australia’s second-largest oil and gas producer, rose 2.6 percent to A$35.66, snapping a four-day, 10 percent slump. Inpex Corp., Japan’s biggest oil explorer, added 4.5 percent to 673,000 yen. Jiangxi Copper Co., China’s second-biggest smelter, gained 4.1 percent to 12.33 yuan in Shanghai.
Technology Companies
Toshiba, Japan’s biggest chipmaker, rose 4.7 percent to 403 yen and Fujitsu added 3.1 percent to 406 yen. The two companies are in final talks about a hard-disk drive joint venture in which Toshiba would have a majority stake, according to four people familiar with the discussions. Fujitsu also plans to lower its earnings forecast, those people said.
Sony jumped 5 percent to 2,100 yen. Hitoshi Kuriyama, an analyst at Merrill in Tokyo, boosted his price estimate on the shares by 9.7 percent to 2,267 yen, citing the potential for job cuts and supply chain improvement to boost profitability. The stronger yen and weak demand will cause Sony to report its first operating loss in 14 years, the Nikkei newspaper said yesterday.
Other technology stocks gained. Hitachi Ltd., the world’s biggest maker of hard-disk drives used in notebook computers, rose 2.9 percent to 355 yen. Casio Computer Co., Japan’s largest maker of electronic dictionaries, soared 7.3 percent to 691 yen.
Nissan Motor Co., Japan’s third-largest automaker, jumped 3.5 percent to 325 yen after Reuters reported the company is in talks with Chrysler Corp. to buy assets from the struggling automaker.
Capital Raising
Wesfarmers Ltd., Australia’s No. 2 retailer, dropped 3.4 percent to A$16.90. The company said today it may cut its dividend for a second year after writing off about A$150 million ($100 million) in the first half on provisions and the falling value of some investments.
HSBC Holdings Plc, Europe’s largest bank by market value, fell 2 percent to HK$71.55 in Hong Kong after Morgan Stanley analysts predicted it may have to raise as much as $30 billion and halve its dividend as earnings drop.
Bank of China Ltd., the country’s third largest, rose 3.8 percent after Royal Bank of Scotland Plc sold 10.8 billion shares, according to people familiar with the situation, removing selling pressure on the stock.
Beermakers Drop
In Japan, Sapporo Holdings Ltd. slumped 4.9 percent to 463 yen. Credit Suisse Group said Japan’s beer market will likely contract this year as the domestic economy continues to weaken and restaurant sales slump. Yoshiyasu Okihira, a Tokyo-based analyst at Credit Suisse, cut his recommendations on Asahi Breweries Ltd., Kirin Holdings Co., and Sapporo, Japan’s top three brewers.
Shipping companies climbed after the Baltic Dry Index, a measure of freight costs, rose 2.5 percent, a sixth consecutive gain. Cosco Corp Singapore Ltd., the shipbuilding and repair unit of China’s biggest shipping company, added 5 percent to 84.5 Singapore cents. Mitsui O.S.K. Lines Ltd., Japan’s second-biggest bulk shipper, jumped 4.3 percent to 608 yen.
Bumiputra-Commerce Holdings Bhd., Malaysia’s second-biggest bank by assets, plunged 5 percent to 6.65 ringgit after UBS AG downgraded the stock to “neutral,” saying the lender will likely have no loan growth due to the weak economy.
