BLBG:Asian Shares Gain as Yen Drops on G-20; Precious Metals Rebound
Asian stocks rose toward an 18-month high, led by Japanese equities, and the yen fell after Group of 20 nations refrained from censuring the nation’s currency policy. Silver and gold climbed.
The MSCI Asia Pacific Index added 0.5 percent as of 1:50 p.m. in Tokyo, where the Nikkei 225 Stock Average climbed 2.1 percent. The Shanghai Composite Index added less than 0.1 percent, while Standard & Poor’s 500 Index futures increased 0.1 percent. The yen weakened 0.6 percent to 94.11 per dollar and South Korea’s won reached its highest since 2008 against Japan’s currency.
G-20 finance ministers and central bankers ended talks in Moscow on Feb. 16 pledging not to “target our exchange rates for competitive purposes,” without singling out Japan. The yen tumbled almost 14 percent against the dollar in three months in response to Prime Minister Shinzo Abe stimulus policies. China’s stocks swang between gains and losses after holiday retail sales rose at the slowest pace in four years amid a crackdown on spending by officials, while travel abroad jumped.
“Investors are really playing the weak-yen, buying-stocks trend now after the G-20,” said Khiem Do, Hong Kong-based head of Asian multi-asset strategy at Baring Asset Management Ltd., which oversees about $51 billion. “We have been adding to our holdings in Japanese stocks, but going forward it depends on valuations and the implementation of Abe’s plans.”
The MSCI Asia Pacific Index traded within 0.5 percent of its highest close since August 2011. Asia’s benchmark trades at 14.8 times estimated earnings compared with 13.7 for the S&P 500 and 12.3 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Toyota, Nintendo
Japan’s Nikkei 225 climbed the most in more than a week, with exporters Toyota Motor Corp. and Nintendo Corp. rising more than 1.4 percent. BlueScope Steel Ltd. surged 15 percent after Australia’s largest steelmaker reported a smaller net loss. Li & Fung Ltd., a supplier of toys and clothes to Wal-Mart Stores Inc., lost 1.2 percent in Hong Kong as the U.S. retailer had the worst sales start to a month in seven years.
The yen fell against all 16 of its major peers, extending losses that made it the worst-performing major currency in the past three months. South Korea’s won climbed 1.3 percent to 8.68 yen, the highest in more than four years.
Japanese officials in Moscow denied driving down their currency, arguing that its weakness was a byproduct of their effort to revive the world’s third-largest economy, which would benefit trading partners. The fact the G-20 communique didn’t single out Japan means the yen may weaken toward 100 per dollar in the next few months, UBS AG said in a report.
Holiday Spending
Sales at Chinese shops and restaurants monitored by the Ministry of Commerce increased 14.7 percent in the Feb. 9 to Feb. 15 period from the year-earlier break, the smallest gain since 2009. Travel agencies handled more than 4 million tourists visiting overseas, a 14 percent gain on last year, with Thailand, South Korea and Hong Kong among the hottest destinations, according to the National Tourism Administration.
Gold advanced, rebounding from its worst weekly performance since May, as prices at the cheapest in six months lured buyers. Spot gold rose as much as 0.4 percent to $1,616.80 an ounce. Silver and platinum added at least 0.6 percent.
Bullion tumbled 3.4 percent last week as improving economic data from the U.S. reduced the appeal of haven assets. The precious metal held in exchange-traded products shrank by the most since July last week, totaling 2,602.335 metric tons on Feb. 15, according to data compiled by Bloomberg. Billionaire investors George Soros and Louis Moore Bacon cut their stakes in gold ETPs last quarter, government filings showed last week.
Malaysia’s ringgit dropped 0.7 percent to 3.0995 per dollar as polls showed sliding popularity of Prime Minister Najib Razak before a general election. The premier must dissolve parliament by April 28.
To contact the reporters on this story: Jason Clenfield in Tokyo at jclenfield@bloomberg.net; Anna Kitanaka in Tokyo at akitanaka@bloomberg.net
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net
