BLBG:Asian Stocks, Oil Rally As China Inflation Slows; Corn Advances
Asian stocks rose for a fourth day and oil gained as easing inflation in China fueled speculation policy makers will have room for more economic stimulus. Corn climbed toward a record, while the Australian dollar gained after jobs data beat forecasts.
The MSCI Asia Pacific (MXAP) Index advanced 0.9 percent as of 1:55 p.m. in Tokyo as South Korea’s Kospi Index climbed 2 percent. Standard & Poor’s 500 Index futures added 0.3 percent. Oil in New York rose 0.3 percent, while corn in Chicago increased 0.4 percent. The so-called Aussie gained 0.3 percent against the dollar. The yen fell against 13 of its 16 major peers.
Statistics bureau figures showed China’s consumer inflation slowed for a fourth month, while separate reports today may show the nation’s retail sales slipped and industrial production expanded. The Bank of Japan left its stimulus programs unchanged following a policy meeting today, as data showed machinery orders rebounded less than forecast in June. Data on U.S. jobless claims are due today, while French factory output figures are scheduled for tomorrow.
“The market is expecting some type of policy support from the Chinese government to accelerate the economy because momentum is slowing at this point,” said Tim Leung, a portfolio manager who helps manage about $1.5 billion at IG Investment Ltd. in Hong Kong. “The market will be excited if there are some concrete signs of policy support.”
Seven stocks climbed for every two that fell in the MSCI Asia Pacific Index. Taiwan’s Taiex Index rose 1.5 percent, Japan’s Nikkei 225 Stock Average advanced 1.2 percent and Hong Kong’s Hang Seng Index gained 0.8 percent.
Nikon Tumbles
China Yurun Food Group Ltd. (1068), a Chinese meat supplier, surged 6.9 percent in Hong Kong as Kerry Group raised its stake in the company. Zhen Ding Technology Holding Ltd., a circuit board maker that got 88 percent of its 2011 sales in China, jumped 7 percent in Taipei. Nikon Corp. (7731), a Japanese maker of cameras and chipmaking equipment, tumbled 8.1 percent after cutting its profit forecast.
Demand for more risky assets increased after China’s statistics bureau reported consumer prices rose 1.8 percent in July from a year earlier. The number compares with the 1.7 percent median forecast in a Bloomberg News survey of 33 economists and a 2.2 percent gain in June.
“Inflation isn’t a concern now,” said Dai Ming, a fund manager at Hengsheng Hongding Asset Management Co. in Shanghai, which manages $190 million. “Market expectations about policy loosening is there and that’ll provide support to the market.”
Oil, Corn
Oil rose 0.3 percent to $93.65 a barrel as speculation that China will do more to support its economy bolstered the outlook for crude. Corn for December delivery rose 0.4 percent to $8.2 a bushel on the Chicago Board of Trade. Futures surged to a record $8.205 a bushel on July 31.
The yen rose less than 0.1 percent to 78.40 per dollar and was down 0.2 percent at 97.13 to the euro. The Dollar Index, which tracks six major peers, fell 0.1 percent.
The Bank of Japan refrained from loosening monetary policy at its first meeting with two new board members. The central bank kept its asset-purchase fund at 45 trillion yen ($573 billion) and lending facility at 25 trillion yen, according to a statement released in Tokyo today. All 22 analysts surveyed by Bloomberg News predicted no change.
The Bank of Korea kept borrowing costs at a 14-month low today after a surprise cut in July as policy makers await more data to gauge the fallout from Europe’s sovereign-debt crisis. South Korea’s bonds fell, pushing the three-year yield to a one- week high, and the won gained 0.2 percent.
Australia’s dollar gained 0.3 percent to $1.0599. The number of people employed in Australia rose by 14,000, the nation’s statistics bureau reported in Sydney today, more than the 10,000 increase predicted in a Bloomberg economist survey.
To contact Bloomberg News staff for this story: Chua Baizhen in Beijing at bchua14@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
