BLBG:Asia Stocks, Currencies Rise on Manufacturing
Asian stocks rose for a third day after data showed a global expansion in manufacturing and Nomura Holdings Inc.’s unexpected profit increase boosted financial shares. Asian currencies strengthened to a three-month high, while copper declined.
The MSCI Asia Pacific Index (MXAP) gained 1 percent as of 2:50 p.m. in Tokyo. Standard & Poor’s 500 Index futures added 0.2 percent. Malaysia’s ringgit and South Korea’s won led gains in the Bloomberg-JPMorgan Asia Dollar Index (ADXY), which tracks the region’s 10 most active currencies excluding the yen. Treasury 10-year yields advanced one basis points to 1.84 percent and bond risk in Asia slid to a three-month low.
U.S. manufacturing grew at the fastest pace since June, according to data from the Institute for Supply Management, while a government report showed construction spending increased more than forecast. The U.K.’s factory measure unexpectedly reached an eight-month high and manufacturing gauges in Europe, China and India rose in January.
“We got more confirmation that business confidence in the U.S. and Europe is improving,” said Mitsushige Akino, who oversees about $600 million at Ichiyoshi Investment Management Co. in Tokyo. “The European debt crisis is in a temporary lull, so stocks sensitive to the economy will have a chance to gain.”
TSE Glitch
The Tokyo Stock Exchange suffered its biggest disruption in six years as a computer glitch forced the halt of trading in 241 securities, prompting concern about system reliability amid the bourse’s bid for its Osaka rival. Trading in the affected securities, which included shares of Sony Corp. and Hitachi Ltd., resumed at 12:30 p.m. local time, about 4 1/2 hours after the bourse said the error was detected.
Facebook Inc., the social-networking website that began about eight years ago in a Harvard University dorm, filed to raise $5 billion in an initial public offering in what would be the largest Internet IPO on record. The company, which now boasts more than 800 million users, didn’t specify the number or price of shares it will offer in a regulatory filing yesterday.
The Shanghai Composite Index (SHCOMP) added 1.5 percent and the Hang Seng Index increased 1.7 percent. Chinese Premier Wen Jiabao said the government will support small companies with a 15 billion-yuan ($2.4 billion) fund as growth moderates in the world’s second-largest economy.
Nomura Jumps
A measure of financial shares climbed 1.4 percent, contributing the most to the advance in the MSCI Asia Pacific Index. Nomura rallied as much as 8.2 percent. Japan’s biggest brokerage reported net income climbed 33 percent to 17.8 billion yen ($234 million) for the three months ended Dec. 31 from a year earlier. The average estimate of seven analysts surveyed by Bloomberg was for a 2 billion yen loss.
LG Electronics Inc. (066570), the world’s third-largest maker of mobile phones, advanced 7.4 percent after reporting the first profit in seven quarters for its handset business. Sharp Corp. (6753) tumbled 16 percent to the lowest level since June 1980. Japan’s largest maker of liquid-crystal display panels predicted a record loss on slumping prices for its Aquos televisions.
The South Korean won climbed 0.7 percent to 1,118.30 and Malaysia’s ringgit jumped 0.7 percent to 3.0220.
“With gains in stocks and good data out of the U.S., risk sentiment is improving,” said Hideki Hayashi, a researcher at the Japan Center for Economic Research in Tokyo. “We will probably see some more fund inflows into the region for now, supporting Asian currencies.”
Treasuries fell before reports today and tomorrow that may show the U.S. added more jobs in January. Employment grew by 145,000 last month after rising 200,000 in December, according to the median forecast of economists surveyed by Bloomberg News before the Labor Department report tomorrow. Initial claims for jobless insurance probably fell last week, a separate survey shows before the department issues the figure today.
The cost of protecting Asia-Pacific corporate and sovereign bonds against non-payment fell, according to credit-default swap traders. The Markit iTraxx Asia index of 40 investment-grade borrowers outside Japan fell 3 basis points to 174.5, Royal Bank of Scotland Group Plc prices show. The measure is set for its lowest close since Oct. 28, according to data provider CMA.
Copper for delivery in three months dropped as much as 0.8 percent to $8,370 a metric ton on the London Metal Exchange.
To contact the reporters on this story: Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net.
To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net
