29 Apr 2009
April 29 (Bloomberg) -- Asian stocks rose for the first time in three days, led by commodity and consumer-related companies, on signs earnings in the region are rising, and as South Korea's current-account surplus widened.China Petroleum & Chemical Corp., Asia's biggest refiner, gained 2.9 percent in Hong Kong trading after saying first-half profit may climb more than 50 percent. Samsung SDI Co., the world's second-largest plasma-display maker, jumped 7.1 percent in Seoul after Hana Daetoo Securities Co. said the company's earnings will improve. Australia & New Zealand Banking Group Ltd. sank 6 percent in Sydney as rising bad debts dragged first-half profit down by 28 percent.
"There are some very small bright spots emerging," said Chris Hall, who helps oversee about $2 billion at Adelaide, South Australia-based Argo Investments. "People are possibly feeling a bit better that banks and governments are throwing a lot of money at the problem."
The MSCI Asia Pacific excluding Japan Index rose 1.6 percent to 266.95 at 12:38 p.m. Hong Kong time. The gauge lost 4 percent in the past two days amid concern an outbreak of swine flu will derail a global economic recovery. The MSCI index has rallied 25 percent in the past two months amid speculation the worst of the financial crisis had passed.
The Japanese market is shut for a holiday. Hong Kong's Hang Seng Index gained 1.8 percent, while South Korea's Kospi index climbed 1.6 percent. Taiwan's Taiex index advanced 0.4 percent as the government said it may act to buttress stocks against swine flu concerns.
Government Stimulus
Futures on the U.S. Standard & Poor's 500 Index added 0.3 percent. The gauge lost 0.3 percent yesterday as concerns that banks need more capital and the swine-flu outbreak will thwart an economic recovery offset a bigger-than-expected jump in consumer confidence.
Li & Fung Ltd., the biggest supplier of toys and clothes to Wal-Mart Stores Inc., surged 6.7 percent to HK$20.95 in Hong Kong as the consumer report fueled optimism U.S. demand will pick up. In Sydney, BlueScope Steel Ltd., Australia's largest steelmaker, slumped 5.6 percent after Deutsche Bank AG said the company may sell shares. Fortescue Metals Group Ltd., Australia's third-largest iron ore exporter, fell 4.1 percent after cutting its sales forecast.
Signs have emerged this month that government stimulus packages and interest-rate cuts worldwide are starting to take effect. New Zealand's statistics bureau said today the country's trade deficit narrowed in March amid record exports.
Beating Estimates
The MSCI Asia Pacific Index, which includes Japan, has rallied 24 percent from a five-year low on March 9 amid optimism for a global recovery. Average company valuations on the gauge had risen to 20 times reported profit as of yesterday, the highest since June 29, 2004, data compiled by Bloomberg show.
"People in the market are looking for a reason to buy cheap equities," said Angus Gluskie, who manages about $256 million at White Funds Management Pty. in Sydney. "They are being too optimistic."
China Petroleum, also known as Sinopec, rose 2.9 percent to HK$5.76. The company said profit is expected to grow after the government eased fuel-price controls and oil slumped from a record. First-quarter net income jumped 85 percent, Sinopec said.
Also in Hong Kong, Bank of China Ltd., the nation's third largest by market value, gained 1.8 percent to HK$2.81, while Bank of Communications Ltd. rose 3.4 percent to HK$6.06. The two lenders posted first-quarter profit that beat analysts' estimates as record lending growth outweighed the impact of a slowing economy and asset writedowns.
Overseas Shipments
Samsung SDI, which reported a first-quarter loss yesterday, climbed 7.1 percent to 89,000 won. Hana Daetoo Securities raised its recommendation to "buy," saying earnings will improve "rapidly" starting in the second quarter.
South Korean companies that rely on overseas sales advanced after the central bank said South Korea's current-account surplus widened to a record $6.65 billion in March as imports fell and the pace of a decline in exports eased. Overseas shipments, which make up 60 percent of South Korea's gross domestic product, rose 10.5 percent from February.
Samsung Electronics Co., the world's second-largest maker of mobile phones, added 0.9 percent to 580,000. UBS AG increased its share-price target by 9.1 percent.
Hynix Semiconductor Inc. gained 2.9 percent to 14,400 won. The company plans to sell about 500 billion won ($368 million) of equipment, the Maeil reported, citing unidentified industry officials.
ANZ Banking slumped 6 percent to A$15.63. The bank cut its dividend for the first time since 1991 as its credit impairment charge almost doubled. National Australia Bank Ltd., the nation's largest by assets, sank 2.7 percent to A$20.71.
BlueScope slumped 5.6 percent to A$2.35. Bluescope may sell A$1 billion ($707 million) of shares at a discount to reduce debt, Deutsche Bank analysts led by Emily Behncke wrote in a report yesterday.
Fortescue fell 4.1 percent to A$2.32 after cutting its full-year sales forecast by 15 percent due to slower than anticipated mining rates and ore grades. The company said third- quarter profit slumped 66 percent.
