Asian stocks rise third day as Japan banks advance

BHP Billiton Ltd. (BHP), the world's largest miner, climbed 2.5 percent to advance for a fourth day in Sydney, its longest winning streak in more than two months. Mitsubishi UFJ Financial Group Inc., Japan's biggest bank, rose toward its highest since June 2009 as speculation grew Bank of Japan stimulus measures will boost earnings at financial-services firms. Billabong International Ltd. (BBG) slumped 26 percent after the Australian surfwear maker said it will hold talks on a A$287 million ($300 million) takeover deal.

The MSCI Asia Pacific Index advanced 0.9 percent to 135.89 as of 12:29 p.m. in Tokyo, with about two stocks rising for every one that fell. The measure is heading for its longest winning streak since Feb. 20 as Chinese economic reports point to reduced chances of further tightening in the world's second- largest economy.

"The global economic recovery is gradually coming through and most of the big systemic risks are behind us," Daphne Roth, Singapore-based head of Asia equity research at ABN Amro Private Bank, which oversees about $207 billion, said in a telephone interview. "The cycle has become more normalized and it will be good for Asia as a whole. Central-bank policy makers have done their part and that's good for equities."

Chinese Premier Li Keqiang, who succeeded Wen Jiabao last month in a once-a-decade leadership transition, has signaled his government will take steps this year to loosen state control over interest rates as part of efforts to sustain economic growth.

Imports Jump

Cha's Imports rose by an above-forecast 14.1 percent in March while shipments abroad increased 10 percent from a year earlier, the customs administration said today in Beijing. Weaker trade growth adds to Li's challenges in sustaining a rebound while he tries to limit nontraditional banking and damp housing prices.

"The tail risks have dissipated and that gives you some form of optimism when you look at the growth numbers," said Tim Schroeders, who helps manage $1 billion at Pengana Capital Ltd. in Melbourne. "There's reason to be optimistic, but don't get too ahead of yourself. The transition under the new leadership in China is progressing well."

Regional Gauges

Japan's Nikkei 225 Stock Average (NKY) gained 0.7 percent, to the highest level since August 2008. Australia's S&P/ASX 200 Index fell 0.2 percent and Singapore's Straits Times Index slipped 0.3 percent.

South Korea's Kospi index added 0.8 percent, Taiwan's Taiex Index rose 0.3 percent and New Zealand's NZX 50 Index advanced 0.5 percent. Hong Kong's Hang Seng Index (HSI) gained 0.3 percent and China's Shanghai Composite slipped 0.2 percent after rising as much as 0.3 percent.

The MSCI Asia Pacific Index (MXAP), the benchmark regional equities gauge, climbed the past five months on speculation Japan would unleash more stimulus and amid signs the U.S. economy is recovering. That left the measure trading at 13.7 times average estimated earnings yesterday compared with 14.2 for the Standard & Poor's 500 Index and 12.4 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Fed Minutes

Economic conditions in the world's largest economy are far from where Federal Reserve Chairman Ben S. Bernanke would like them to be, he said April 8. The Federal Open Market Committee releases minutes of its March 19-20 meeting today. After that meeting, Bernanke said further gains in the U.S. labor market were needed for the Fed to consider reducing its monetary easing.

Futures on the S&P 500 Index (SPX) slipped 0.1 percent. The gauge rose 0.4 percent yesterday and the Dow Jones Industrial Average climbed 0.4 percent to 14,673.46, its highest-ever closing level, on optimism over earnings and as commodities gained after a report showing China's inflation rate slowed.

Raw-material firms and Japanese banks contributed most to gains on the MSCI Asia Pacific Index. BHP Billiton advanced 2.5 percent to A$34.94 and Rio Tinto Group, the world's second- largest mining company, added 3 percent to A$58.41 in Sydney. Mitsubishi UFJ rose 4.2 percent to 650 yen and Sumitomo Mitsui Financial Group Inc. (8316) advanced 6 percent to 4,590 yen in Tokyo.

Billabong lost 26 percent to 54 Australian cents. That's a 9.2 percent discount to the 60 cents non-binding offer that Billabong is discussing with a group including Sycamore Partners Management, and values the retailer at less than the inventory in its stores and warehouses as of Dec. 31.

Cosmo Oil Co. (5007) surged 9.1 percent to 216 yen in Tokyo after the Nikkei newspaper reported profit at the refiner may increase 50 percent.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net
To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

Source: BLOOMBERG Company