Japanese stocks rose for the week, leading the Nikkei 225 Stock Average to its best month in four years. Export-ers such as Sony Corp gained after the yen fell against the US dollar, easing concerns about the value of their overseas earnings.
"The weakness in the yen has been supporting the market here," said Takashi Miyazaki, who helps manage the equivalent of US$8.6 billion in equities as a senior strategist at UFJ Partners Asset Management Co. "Still, it may be too early to get too optimistic for a solid recovery."
The Nikkei gained 2.9 percent, taking its monthly advance to 7.6 percent, the biggest since June 1999. The Topix index rose 1.4 percent for the week and 5.2 percent for the month.
Taiwan's TWSE Index climbed 4.7 percent, its fourth weekly gain and the largest this year. Computer-related stocks such as Taiwan Semiconductor Manufacturing Co led the advance after a US consumer confidence index climbed to a six-month high, boosting optimism for overseas sales.
South Korea's Kospi index ended the week 3.6 percent higher.
Hong Kong's Hang Seng Index climbed for a fifth week, up 2 percent, after the World Health Organization on May 23 lifted its advisory against travel to the city as the number of SARS victims dropped. The index rose for the first month since November.
In Japan, computer-related stocks as a group accounted for almost half of the Topix's advance. Sony rose 4.6 percent. The world's second-largest consumer electronics maker adds between ?6 billion (US$48 million) and ?8 billion in annual operating profit for every ?1 drop against the dollar.
Canon Inc, Japan's largest office equipment maker, rose 4 percent last week. A movement in the value of the dollar by one yen will affect annual sales by ?11.4 billion and annual operating profit by ?5 billion.
The yen weakened 1.3 percent last week against the dollar. On May 19, the Japanese currency touched ?115.07 per dollar, its strongest level in more than two years.
Taiwan's TWSE added 9.8 percent last month. The TWSE Electronics Index that tracks the performance of the island's electronics stocks accounted for almost 70 percent of the benchmark's climb last week.
Taiwan Semiconductor, the world's largest maker of computer chips on a subcontracting basis, added 9 percent. The chipmaker will increase production after it received orders that will use more than 85 percent of its factory capacity between last month and August, the Economic Daily News reported, without citing where it got the information.
Quanta Computer Inc, which counts Dell Computer Corp and Hewlett-Packard Co as customers, climbed 6.1 percent.
In Korea, financial stocks as a group contributed almost two-fifths to the Kospi's advance. LG Card Co, the nation's biggest card issuer, rose 25 percent. Korea Exchange Bank Credit Services Co gained 19 percent, its fourth advance in five weeks.
LG Card and other local card companies will raise 1.8 trillion won (US$1.5 billion) in the third quarter, the state-run Financial Supervisory Service said. Credit-card companies earlier said they will raise 4.6 trillion won by the end of this year.
"It's time to buy banking and credit-card companies shares" because they're making an effort to improve cash flow, said Choi Yong Kyu, who manages the equivalent of about US$3.3 million at KEB Commerz Investment Trust Man-agement Co in Seoul. Choi may buy more shares of LG Card and Kookmin Bank.
Card companies also rose after Standard Chartered Plc said Thursday it wants to buy a card company in Korea.
Kookmin Credit Card Co, 74 percent owned by Kookmin Bank, rose 27 percent on the Kosdaq Stock Market. The lender said it will merge its card issuing business with Kookmin Credit to cut costs. Kookmin Bank climbed 13 percent, its biggest weekly gain since the five days ended Oct. 18, and was the second-biggest contributor to the Kospi's advance.
The Kospi rose 5.7 percent last month, its second monthly advance.
The Hang Seng rallied 8.8 percent last month, the biggest such advance since November 2001, as the number of severe acute respiratory syndrome cases dropped. Hong Kong has the second- highest tally of SARS cases.
Cathay Pacific Airways Ltd. rose 3.7 percent last week on optimism demand for travel will rebound.
Developers such as Sun Hung Kai Properties Ltd. and Cheung Kong (Holdings) Ltd also gained on expectations the outbreak is now under control and the US will lead a global economic recovery now that the Iraq war is over, aiding domestic growth.
Sun Hung Kai, the city's biggest developer by sales, advanced 2.6 percent. Cheung Kong, the biggest by market capitalization, added 1.3 percent.
"I am optimistic," said Paul Pong, managing director at Pegasus Fund Managers Ltd, which invests the equivalent of US$64 million.
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