BLBG: Asia Stocks, Won Gains on Rising Confidence; Bond Risk Retreats
By Rocky Swift and Yasuhiko Seki
March 30 (Bloomberg) -- Asian stocks climbed toward a 10- week high, the South Korean won strengthened and bond risk in the region fell as improving business confidence encouraged investors to seek higher-yielding assets.
The MSCI Asia Pacific Index rose 1 percent to 126.23 at 4 p.m. in Tokyo, set for the highest close since Jan. 18. The won climbed versus 15 of 16 of its most-traded counterparts, and the cost of protecting corporate bonds from non-payment fell in Japan and Australia. The Stoxx Europe 600 climbed 0.3 percent at 8 a.m. in London. Standard & Poor’s 500 futures rose 0.2 percent.
Consumer spending in the U.S. rose in February for a fifth straight month. A South Korean central bank survey said manufacturers are the most confident they’ve been in at least seven years and a report showed European sentiment improved to the highest in almost two years. New Zealand said home-building approvals gained in February for the first time in three months.
“With a slew of economic data signaling a steady economic recovery at home and abroad, risk sentiment is also picking up,” said Masahide Tanaka, a senior strategist in Tokyo at Mizuho Trust & Banking Co. “And as risk sentiment improves, assets such as stocks and higher-yielding currencies are likely to draw stronger capital inflow going forward.”
The MSCI Asia gauge headed for a 5 percent gain this quarter, a fourth-straight advance. On a monthly basis, the index is poised for a 6.6 percent increase in March, the most since July.
Japanese Stocks
Japan’s Nikkei 225 Stock Average gained 1 percent, set for its highest close since October 2008, as a report from the statistics bureau showed the country’s jobless rate held in February at the lowest in about a year.
Korea Exchange Inc. said today it expects the number of foreign listings to jump more than fivefold by 2012 as “ample” liquidity lures companies from China, the U.S. and Japan.
Raw material producers posted the biggest gain among 10 industry groups in the MSCI Asia Pacific Index. Mitsubishi Corp., which gets about 40 percent of sales from commodities, leapt 3.9 percent to 2,462 yen. BHP Billiton Ltd., the world’s No. 1 mining company, jumped 2.4 percent to A$44.41. BHP plans to sell iron ore to Asian steel mills on short-term contracts, enabling it to benefit from rising spot prices.
Canon Inc., the world’s largest camera maker, gained 2.5 percent to 4,325 yen in Tokyo. Konica Minolta Holdings Inc., the Japanese maker of printers, scanners and film used in liquid- crystal displays, climbed 3.5 percent to 1,096 yen after Mitsubishi UFJ Securities upgraded the stock to “outperform” from “market perform.” Hynix Semiconductor Inc., the world’s second-largest maker of computer memory, added 1.9 percent after it said chipmakers are meeting about 60 percent of demand after they scaled back investments.
Business Confidence
The Bank of Korea said today its index of manufacturers’ expectations climbed to 105 in March, the highest since the fourth quarter of 2002, when the bank published its confidence survey on a quarterly basis. That followed a report yesterday from the European Commission that its index of executive and consumer sentiment rose to 97.7 in February, the highest since May 2008 and topping estimates.
The won led gains among Asian currencies, climbing for a third day on speculation the nation’s improving economy will attract more funds from abroad. Foreign investors bought more Korean shares than they sold on all but one day since the end of February, and trade data this week is forecast to show exports climbed in March for the fifth month in a row.
“Risk appetite’s up and fundamentally the news in Asia is really positive,” said Mitul Kotecha, the Hong Kong-based head of global currency strategy at Credit Agricole CIB. “There’s evidence of strong flows coming into the region and that’s helping to boost Asian currencies as well. We’re still bullish on Asia for the rest of the year.”
Won Strengthens
The won strengthened 0.4 percent to 1,130.10 per dollar in Seoul, according to data compiled by Bloomberg. The Bloomberg- JPMorgan Asia Dollar Index, which tracks the region’s 10 most- used currencies excluding the yen, was headed for its highest close since August 2008.
Permits to build homes in New Zealand increased 5.9 percent in February, compared with economist estimates for a 2 percent advance, adding to signs construction will buoy economic growth and spur the nation’s central bank to raise interest rates.
The MSCI Asia Pacific Index has climbed 10 percent from its lowest level in more than two months on Feb. 8 as improving U.S. jobs data, a Federal Reserve pledge to keep borrowing costs low and a Japanese bank-lending program eased concern that budget deficits in Europe will derail the global recovery.
‘On Track’
“The recovery is on track, but there still remains a number of structural issues that markets need to be wary of,” said Stephen Halmarick, Sydney-based head of investment-markets research at Colonial First State Global Asset Management, which holds $135 billion. “Governments are very committed to keeping policies in place until they get the results they’re after.”
The Markit iTraxx Japan Series 13 index decreased 3 basis points to 114 basis points, according to Morgan Stanley. That is the lowest since Sept. 25, a day after the Series 12 benchmark started trading, according to CMA DataVision prices. The Markit iTraxx Australia index fell 1.5 basis point to 84 basis points, according to Australia & New Zealand Banking Group Ltd.
Oil for May delivery was at $82.62 a barrel, up 45 cents, in electronic trading on the New York Mercantile Exchange. Yesterday, the contract rose $2.17, or 2.7 percent, to $82.17, the highest settlement since March 18 and the biggest gain since Feb. 16. Copper for three-month delivery on the London Metal Exchange dropped as much as 0.8 percent to $7,711 a ton after gaining as much as 3.8 percent yesterday to $7,800, the highest in 19 months. The metal had gained as inventories declined and a sinking dollar made metals more appealing as an alternative investment. It traded at $7,765 a ton in Asia.
To contact the reporters for this story: Rocky Swift in Tokyo at rswift5@bloomberg.net. Yasuhiko Seki in Tokyo at yseki5@bloomberg.net.
