Asian Stocks Rise as Japanese Exporters Rally on Weak Yen – Bloomberg

Asian stocks rose as Japan’s Nikkei
225 Stock Average climbed above 15,000 for the first time since
January 2008 after the yen touched a 4 1/2-year low against the
dollar, boosting the earnings outlook for exporters.

Sony Corp. surged 12 percent as billionaire Danie Loeb
pushed for the initial public offering of the Japanese
electronics maker’s entertainment business. Toyota Motor Corp. (7203),
the world’s biggest carmaker, climbed 2.6 percent in Tokyo.
Neptune Orient Lines Ltd. rose 1.8 percent in Singapore after
Southeast Asia’s largest container-shipping company returned to
profit in the first quarter.

The MSCI Asia Pacific Index gained 0.8 percent to 143.16 as
of 12:22 p.m. in Tokyo, with almost two shares rising for each
that fell. The gauge increased 9.8 percent this year through
yesterday as the Bank of Japan took steps to counter deflation
and policy makers in the U.S. and Europe remained on standby to
buoy growth.

“Every time the yen falls below a key level, the Nikkei
passes another milestone because it boosts corporate profits,
especially for manufacturers,” said Masaru Hamasaki, a senior
strategist at Tokyo-based Sumitomo Mitsui Asset Management Co.,
which oversees the equivalent of $100 billion. “Stocks should
rise further as investors acknowledge the impact of government
policy. Given that, I don’t think stocks are that expensive.”

Shares on the MSCI Asia Pacific Index traded at 14.4 times
estimated earnings yesterday, compared with 21 for the Nikkei
225, 15 for the Standard & Poor’s 500 Index and 13.4 for the
Stoxx Europe 600 Index, according to data compiled by Bloomberg.

‘Building Momentum’

Japan’s benchmark Nikkei 225 jumped 2.3 percent to
15,096.97. The broader Topix Index advanced 2.1 percent. The yen
touched 102.43 per dollar, the lowest since October 2008, before
trading at 102.27 at 12:06 p.m. in Tokyo.

The yen fell 18 percent against the dollar this year
through yesterday as the Bank of Japan introduced unprecedented
monetary easing and the U.S. economy showed recovery signs. A
weaker yen enhances overseas earnings at Japanese exporters when
repatriated.

“Downward pressure on the yen against the dollar is
strengthening, boosting earnings outlooks, especially for
exporters,” said Hiroichi Nishi, an equities manager in Tokyo
at SMBC Nikko Securities Inc., a unit of Sumitomo Mitsui
Financial Group Inc., Japan’s second-biggest lender. “Momentum
is building for a global stock rally.”

Taiwan’s Taiex Index and Hong Kong’s Hang Seng Index both
gained 0.4 percent, while China’s Shanghai Composite lost 0.1
percent. South Korea’s Kospi Index slipped 0.2 percent.

Australian Budget

Australia’s S&P/ASX 200 Index dropped 0.9 percent after
Treasurer Wayne Swan announced yesterday the government will
record a A$19.4 billion ($19.2 billion) deficit this fiscal year
and the budget will only return to balance in the 12 months
through June 2016. The Australian dollar dropped to an 11-month
low after the release. New Zealand’s NZX 50 Index swung between
gains and losses.

Futures on the S&P 500 Index slid 0.1 percent today. The
index rose 1 percent yesterday in New York to its eighth record
high in the past nine sessions. Germany’s DAX Index advanced 0.7
percent to 8,339.11, a record high.

Sony jumped 12 percent to 2,094 yen in Tokyo. Third Point
asked Chief Executive Officer Kazuo Hirai to consider selling as
much as 20 percent of the company’s Sony Entertainment unit in
an IPO. The hedge fund led by Loeb holds 115 billion yen ($1.1
billion) of Sony shares.

Japanese exporters advanced. Toyota gained 2.6 percent to
6,370 yen. Panasonic Corp., Japan’s second-largest television
maker, climbed 5.5 percent to 899 yen. Canon Inc., the world’s
biggest camera maker, rose 2.7 percent to 3,745 yen.

Earnings Performance

Mitsubishi UFJ Financial Group Inc. (8306), Japan’s biggest
publicly traded lender, which posts results today, advanced 4.1
percent to 739 yen before announcing results. The lender will
beat earnings estimates and raise its dividend, the Nikkei
newspaper reported.

Of the 419 companies on the MSCI Asia Pacific Index that
reported quarterly results since the beginning of April and for
which estimates are available, 53 percent exceeded expectations,
while 47 percent fell short, according to data compiled by
Bloomberg.

Neptune Orient Lines added 1.8 percent to S$1.11 in
Singapore. The company posted a first-quarter net income of
$75.5 million, helped by gains from selling its headquarters and
lower fuel costs. That compares with a $254 million loss a year
earlier.

Li & Fung Ltd. (494), a supplier of toys and clothes to Wal-Mart
Stores Inc., jumped 6.5 percent to HK$10.96 in Hong Kong after
UBS AG raised its rating to neutral from sell.

Among stocks that fell, Noble Group Ltd., Asia’s largest
publicly traded commodity supplier by sales, slipped 4.9 percent
to S$1.06 in Singapore after reporting first-quarter profit
plunged 62 percent from a year earlier due to losses at its
agricultural unit.

To contact the reporters on this story:
Jonathan Burgos in Singapore at
jburgos4@bloomberg.net;
Yoshiaki Nohara in Tokyo at
ynohara1@bloomberg.net

To contact the editor responsible for this story:
John McCluskey at
j.mccluskey@bloomberg.net