Asian stocks rose, with the regional benchmark index headed for its highest close in seven months, as Chinese banks and insurers surged after a rule limiting insurers’ investments in commercial lenders was abolished and the country’s new leaders pledged to promote “urbanisation.”
Industrial & Commercial Bank of China Ltd, the world’s biggest lender, gained 1.4 per cent in Hong Kong. Ping An Insurance (Group) Co. jumped 5.1 per cent as HSBC Holdings Plc agreed to sell its stake in China’s second-largest insurer for $9.4 billion. Fast Retailing (9983) Co. gained three per cent in Tokyo after Asia’s No. 1 apparel seller reported higher domestic sales at its Uniqlo chain.
The MSCI Asia Pacific Index (MXAP) added 0.3 per cent to 125.17 as of 3:40 pm in Tokyo, erasing losses of as much as 0.3 per cent and heading for its highest close since April 30. Two shares rose for each that fell on the gauge. The measure advanced last month amid signs China’s economic slowdown may be ending and optimism US lawmakers would agree on a budget deal to avert the so-called fiscal cliff.
“There’s a lot of talk about potential policy support for China’s economy,” said Tim Leung, a fund manager who helps oversee about $1.5 billion at IG Investment Ltd. “While urbanization is not new, people will probably be focusing on that trend. There’s a lot of positive benefit from urbanization, like infrastructure spending.”
Japan’s Nikkei 225 Stock Average (NKY) gained 0.4 per cent, reversing losses of as much as 0.6 per cent. South Korea’s Kospi Index rose and Taiwan’s Taiex Index both advanced 0.6 per cent. Hong Kong’s Hang Seng Index rose 1.5 per cent.
Australia’s S&P/ASX 200 Index added 0.4 per cent even as the nation’s economic growth slowed. Gross domestic product rose 0.5 per cent in the third quarter compared to the previous three months, when it expanded 0.6 per cent, a Bureau of Statistics report released in Sydney today showed. The result compared with the median of 25 estimates in a Bloomberg News survey for a 0.6 per cent gain.
Futures on the Standard & Poor’s 500 Index increased 0.3 per cent today. The S&P 500 lost 0.2 per cent yesterday as President Barack Obama held his ground on raising tax rates for the highest-income Americans.
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Fiscal Cliff
A budget compromise would help avert the fiscal cliff, which could result in more than $600 billion in tax increases and spending cuts taking effect next month.
“Investors should still be concerned about the US fiscal cliff as Republicans and Democrats have found it very hard to agree,” said Angus Gluskie, managing director at Sydney-based White Funds Management, which oversees more than $350 million. The MSCI Asia Pacific Index advanced 14 per cent through yesterday from this year’s low on June 4 as central banks added stimulus to spur economic growth. The gauge climbed every day except one during the past 10 sessions.