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Asian stocks rise in longest streak since March
BLOOMBERG AND AFP
, HONG KONG
Sunday, Aug 01, 2010, Page 10
Asian stocks rose for the fourth consecutive week, their longest winning streak in four months, as company earnings reports boosted confidence in the strength of the global economy.
Canon Inc, the world’s largest camera maker, jumped 9.3 percent this week in Tokyo after reporting profit that beat analyst estimates. Sony Corp, the maker of Bravia televisions, gained 7.6 percent in Tokyo after raising its annual forecast. HSBC Holdings PLC, Europe’s largest bank, climbed 3.7 percent in Hong Kong after most European banks passed stress tests. Sanyo Electric Co soared 21 percent after getting a takeover bid.
The MSCI Asia-Pacific Index rose 1.4 percent this week to 119.11 and climbed 5.6 percent this month, its first monthly increase since April and the biggest gain since March. The index has slumped about 8 percent from its high this year on April 15 on concern China’s measures to limit property-price inflation and Europe’s government-debt would stall global growth.
“People are buying on optimism the global economy is on an uptrend after seeing those positive earnings reports,” said Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co, which oversees about US$104 billion.
Japan’s Nikkei 225 Stock Average gained 1.1 percent this week, even as industrial production unexpectedly dropped and unemployment climbed. Hong Kong’s Hang Seng Index rose 1 percent. China’s Shanghai Composite Index advanced 2.6 percent after the central bank said it will keep a “moderately loose” monetary policy.
This week was the peak for April-June earnings reports in the Asia-Pacific region, with more than one-fourth of the 985 companies in the MSCI Asia-Pacific Index releasing results, according to data compiled by Bloomberg. More than half the companies that announced results have exceeded analysts’ estimates, Bloomberg data showed.
Speculation economic growth may falter dragged down the MSCI Asia-Pacific Index by as much as 9.6 percent this year, and the average price of stocks in the gauge dropped this month to the lowest level since December 2008. The index’s companies trade at about 14 times estimated profit.
Taiwan’s TAIEX fell 38.36, or 0.5 percent, to 7,760.63 at the close of Taipei trading at 1:30pm on Friday. The benchmark was little changed for the week and rose 5.9 percent last month, the biggest gain since March.
Chang Hwa Commercial Bank (彰化銀行) gained 2.7 percent to NT$16.90 and Taiwan Business Bank (台灣企銀) advanced 1.8 percent to NT$9.47.
The two companies rose on speculation the two financial services companies may be first to be merged in a government-driven consolidation of the industry, Deutsche Bank AG analyst Nora Hou said.
In other markets on Friday:
Manila edged 2.76 points lower from Thursday to 3,426.59.
Jakarta lost 0.89 percent, or 27.53 points, from Thursday to end at 3,069.28.
Wellington was flat, adding 1.61 points from Thursday to end at 3,034.62.
Mumbai closed 0.69 percent, or 123.71 points, lower from Thursday at 17,868.29. Sentiment turned weak on lower-than-expected earnings from some Indian firms.
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