Most Asian Stocks Rise as Japan Machinery Orders Top Estimates
Most Asian stocks rose as Japan’s machinery orders increased more than economists expected and South Korea’s unemployment rate fell, reflecting resilience of regional economies in the face of Europe’s debt crisis.
Hitachi Ltd., which gets about one-third of sales from industrial machinery, climbed 2.4 percent in Tokyo. Samsung Electronics Co., the world’s largest maker of mobile phones, rose 1.3 percent in Seoul. Esprit Holdings Ltd. tumbled 21 percent in Hong Kong before share trading was suspended after the clothier’s chief executive officer quit.
The MSCI Asia Pacific Index gained 0.3 percent to 113.19 as of 3:38 p.m. in Tokyo, having swung between gains of as much as 0.4 percent and losses of 0.2 percent. About three shares rose for every two that fell in the measure. The gauge dropped 12 percent from this year’s peak on Feb. 29 through yesterday amid concern growth in the US and China is slowing and as Europe’s debt crisis intensified. Greece holds elections June 17 that may determine the country’s future in the euro.
“Valuations are cheap in Asia and economies are still fairly resilient,” said Pauline Dan, Hong Kong-based chief investment officer at Samsung Asset Management Co., which manages $100 billion. “There are still a lot of uncertainties. If Greece elections lead to a euro exit, it will be chaotic.”
Japan’s Nikkei 225 Stock Average added 0.6 percent as machinery orders increased more than economists expected in April. Hitachi climbed 2.4 percent to 476 yen. Fanuc Corp., a maker of industrial robots, added 0.4 percent to 13,580 yen.
South Korea’s Kospi Index added 0.3 percent as the nation’s unemployment rate fell to a four-month low in May. Samsung Electronics added 1.3 percent to 1.271 million won.
China’s Shanghai Composite Index advanced 1 percent amid speculation that government will ease monetary policy and increase spending for infrastructure to stem a slowdown in the economy. Hong Kong’s Hang Seng Index rose 0.5 percent.
Australia’s S&P/ASX 200 Index slipped 0.2 percent as a private survey showed the nation’s consumer confidence stagnated near the lowest level this year. Trading volumes in Australia, China, Hong Kong and Japan were 8 percent lower than the 30-day average, according to data compiled by Bloomberg.
Futures on the Standard & Poor’s 500 Index lost 0.1 percent today. The gauge advanced 1.2 percent yesterday in New York in New York as Federal Reserve Bank of Chicago President Charles Evans said he would support measures to generate faster job growth and after the European Central Bank endorsed a plan to guarantee bank deposits.
Companies that do business in Europe declined as Italy prepared to sell 6.5 billion euros ($8.1 billion) of 364-day bills today and offer debt maturing in 2015, 2019 and 2020 tomorrow. The yield on the nation’s benchmark 10-year government bond rose to as high as 6.3 percent yesterday, a level last seen on Jan. 25.
Hutchison Whampoa Ltd., which operates ports in Spain and Germany, slipped 1.5 percent to HK$63.90 in Hong Kong. Canon Inc., a camera maker that gets about 31 percent of sales from Europe, lost 1.1 percent to 3,215 yen in Tokyo.
Esprit, which counts Europe as its largest market, tumbled 22 percent to HK$10.54, the most since October 1997, before trading was halted in Hong Kong. Chief Executive Officer Ronald Van der Vis became the second top official to quit in six months, jeopardizing the retailer’s turnaround plans.
“The unexpected resignation is a serious blow to the company’s transformation plan and will cast doubt on the execution,” said Andrew Sullivan, principal trader at Piper Jaffray Asia Securities Ltd. in Hong Kong. “Investors may fear that his stepping down will bring the transformation efforts back to square one.”
The Asian benchmark dropped 0.9 percent this year through yesterday, compared with a 5.3 percent advance by the S&P 500 and a 0.5 percent drop by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 1.2 times book value, compared with 2.1 times for the S&P 500 and 1.3 times for the Stoxx 600, according to data compiled by Bloomberg. A number below one means companies can be bought for less than value of their assets.