Asian stocks rose, with the regional benchmark index posting its 10th advance in 11 weeks, as earnings from companies including Fanuc Corp boosted sentiment.
Fanuc jumped 5.3 percent after the Japanese maker of industrial robots reported quarterly profit that beat analysts’ estimates. Itochu Corp rose 2.5 percent after Japan’s third-largest trading company announced a share buyback.
The MSCI Asia Pacific Index gained 0.2 percent to 148.77 in Hong Kong. The measure posted its highest close since June 2008 and a 1.3 percent advance this week. The Standard & Poor’s 500 Index closed at a record on Friday as a raft of better-than-estimated earnings in the US and signs of global manufacturing growth buoyed sentiment.
“While valuations aren’t stretched, there will be limitations as to how far this rally can go,” said Matthew Sherwood, head of investment markets research at Perpetual Ltd in Sydney. “Whenever a downward draft comes into the market, it’s likely to prove short-lived on the back of continued monetary support, valuations and an improving growth environment.”
Japan’s TOPIX climbed 0.9 percent. The nation’s consumer prices excluding fresh food rose 3.3 percent from a year earlier after a 3.4 percent gain in May, the statistics bureau said yesterday in Tokyo. The increase matched the projection in a Bloomberg News survey of 32 economists.
Taiwan underperformed its regional peers, with the TAIEX declining 0.9 percent this week to 9,439.29. On Friday, shares pulled back from a day earlier, as investors locked in their gains in the bellwether electronics sector, creating heavy downward pressure on tech heavyweights, including Largan Precision Co (大立光), dealers said.
While the financial sector continued to move higher amid optimism over second-half earnings, the gains were not strong enough to lift the broader market, they said.
“The 9,500 point mark remained a stiff technical barrier on the local bourse. I think the market needs some time to consolidate before jumping over the technical hurdles ahead of that level,” Concord Securities (康和證券) analyst Kerry Huang said.
“Today’s [Friday’s] selling was concentrated in the electronics sector, which had gained sharply in recent sessions amid optimism toward the peak season in the third quarter,” Huang said “The losses, however, were largely technical in nature as their fundamentals remain sound.”
Among the falling electronics blue chips, Taiwan Semiconductor Manufacturing Co (台積電) dropped 1.6 percent to close at NT$123, while Hon Hai Precision Industry Co (鴻海精密), which assembles iPads and iPhones for Apple Inc, shed 2.26 percent to close at NT$108.00.
Smartphone camera lens supplier Largan dropped 7 percent, the maximum daily decline, to close at NT$2,300, largely on foreign institutional selling that took advantage of its recent upturn. Nonetheless, Largan remained the most expensive stock on the local market.
China’s Shanghai Composite Index rose 1 percent to its highest close since April 14. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong, also known as the H-share index, increased 0.5 percent, while the territory’s benchmark Hang Seng Index added 0.3 percent.
The H-share index may climb another 20 percent, Templeton Emerging Markets Group executive chairman Mark Mobius said on Friday. Mobius, whose $12 billion Templeton Asian Growth Fund has outperformed 94 percent of peers this year, favors state-owned banks and energy companies because of their cheap valuations and the government’s plans to open up state- dominated industries.
The Philippines’ PSEi climbed 0.5 percent, while South Korea’s KOSPI and New Zealand’s NZX 50 Index each advanced 0.4 percent. Australia’s S&P/ASX 200 Index lost 0.1 percent, Singapore’s Straits Times Index slipped 0.1 percent, and India’s S&P BSE Sensex Index lost 0.6 percent.
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