Asian Stocks Gain on U.S. Interest Rate Speculation Earnings
Asian Stocks Gain on U.S. Interest Rate Speculation, Earnings
By Chua Kong Ho and Darren Boey
Jan. 29 (Bloomberg) — Asian stocks rebounded on speculation
the Federal Reserve will cut U.S. interest rates to bolster
growth and after brokerages raised their ratings on Toyota Motor
Corp. and Isuzu Motors Ltd.
PetroChina Co. and Macarthur Coal Ltd. climbed on higher oil
and coal prices. Fanuc Ltd., the world;s largest maker of
industrial robots, and Samsung Engineering Co. rose after posting
higher profits. The MSCI Asia Pacific Index added 1.4 percent,
still set for its worst month since September 2001.
“There will be companies in Asia that will surprise by
being able to deliver growth that markets have not expected,;;
said Kathryn Matthews, chief investment officer for Asia at
Fidelity Investments, which has about $1.5 trillion in global
assets.
HSBC Holdings Plc and Sun Hung Kai Properties Ltd. paced
gains in Hong Kong, where interest rates track those of the U.S.
The city;s Hang Seng Index climbed 1 percent. Japan;s Nikkei 225
Stock Average added 3 percent to 13,478.86.
MSCI;s Asia Pacific index rose to 143.53 as of 7:32 p.m. in
Tokyo, with all 10 of its industry groups gaining. National
Australia Bank Ltd. led declines in Australia after business
confidence dropped to a two-year low. Other markets in the region
advanced except New Zealand and India.
The U.S. Standard %26amp; Poor;s 500 Index added 1.8 percent
yesterday. Bank of America Corp. led financial shares higher on
expectations reduced borrowing costs will boost profits.
Rate Cut
Traders see an 86 percent chance the Fed will cut its
benchmark lending rate by 0.5 percentage point at its Jan. 30
policy meeting, according to Fed funds futures. That;s up from 70
percent on Jan. 25. Lower interest rates may help stave off a
recession in the U.S. economy, Asia;s largest export market.
The Fed is “singing to the tune of what the markets want,
which is a 50 basis point cut,;; said Pankaj Kumar, who manages
about $460 million as chief investment officer at Kurnia Insurans
Bhd. in Petaling Jaya, near Kuala Lumpur. Such a cut will
“provide a relief rally for the markets.;;
Toyota, the world;s largest automaker by value, added 1.3
percent to 5,500 yen. Seiji Sugiura, an analyst at HSBC Holdings
Plc in Tokyo, lifted his recommendation on the shares to
“neutral;; from “underweight,;; saying there is “little risk
of a serious downturn in the U.S. auto market.;;
Analyst Upgrades
Isuzu Motors, the largest Japanese maker of light-duty
trucks, climbed 9.6 percent to 433 yen, the biggest percentage
gain on the MSCI World Index, after Goldman, Sachs %26amp; Co. upgraded
the stock to “buy;; from “neutral.;;
Tata Consultancy Services Ltd., India;s largest computer-
services provider, gained 1.1 percent to 863.25 rupees, while
smaller rival Wipro Ltd. advanced 1.6 percent to 412.7 rupees,
after Morgan Stanley lifted their ratings to “overweight;; from
“equal-weight.;;
“There really isn;t a reason to be as pessimistic as the
recent mood in the market has suggested,;; said Terunobu
Kinoshita, who helps manage $785 million at Fund Creation Co. in
Tokyo.
Other exporters gained. Nintendo Co., the maker of handheld
game consoles that counts the Americas as its largest market,
rose 5.9 percent to 49,550 yen. Samsung Electronics Co., South
Korea;s largest exporter, increased 3.5 percent to 558,000 won.
Taiwan Semiconductor Manufacturing Co., the world;s largest
custom-chip maker, advanced 5.2 percent to NT$57.
Coal, Metals Prices
HSBC, Europe;s No. 1 bank by market value, climbed 0.9
percent to HK$117.60. Sun Hung Kai, Hong Kong;s largest property
group, added 3.9 percent to HK$159.70. Cheung Kong Holdings Ltd.,
the real-estate company controlled by billionaire Li Ka-Shing,
jumped 2.1 percent to HK$127.70.
Hong Kong;s rates typically track the Fed;s because the
city;s currency is linked to the dollar.
Macarthur Coal, which supplies a third of world exports of
coal used in steelmaking, surged 11 percent to A$10.25, a record
close. Centennial Coal, Australia;s second-biggest producer of
the fuel by sales, jumped 8.2 percent to A$3.45. China Shenhua
Energy Co., the world;s second-largest coal company, gained 1.7
percent to HK$42.55 in Hong Kong.
Prices for thermal coal, burnt in power stations, jumped 3.9
percent to a record $93.35 a metric ton in the week ended Jan. 25
at Australia;s Newcastle port, a benchmark for Japan, South Korea
and Taiwan, according to globalCOAL. Crude oil for March delivery
rose 0.3 percent to $90.99 a barrel in New York yesterday.
Fanuc, Nippon Yusen
PetroChina, the nation;s largest oil producer, gained 0.4
percent to HK$11.24. Inpex Holdings Inc., Japan;s biggest oil
explorer, rose 3 percent to 1.03 million yen. PTT Pcl, Thailand;s
biggest energy company, rose 1.3 percent to 308 baht.
Fanuc jumped 7.2 percent to 9,110 yen, after reporting a 23
percent increase in profit in the three months ended December
from a year earlier. Nippon Yusen K.K., Japan;s largest shipping
line by sales, gained 8.1 percent to 825 yen, the most since Oct.
29, after third-quarter profit almost doubled.
Samsung Engineering, South Korea;s biggest engineering
company, rose 2.3 percent to 90,000 won. The company said 2007
net income increased 32 percent from the previous year.
National Australia Bank, the nation;s largest, fell 2.9
percent to A$35.43. Commonwealth Bank of Australia, the No. 2,
slid 3.7 percent to A$51.71.
The country;s business confidence dropped to the lowest
since October 2005, according to a National Australia Bank survey
of 400 companies released today. That signals companies may pare
investment and hiring as global economic growth cools.
To contact the reporter on this story:
Chua Kong Ho at in Shanghai or
