Asian stocks rose as optimism the US will rescue American automakers countered a slump in Japanese business confidence and slowing Chinese industrial output.
Toyota Motor Corp. advanced 9.8 per cent in Tokyo and Hyundai Motor Company jumped 7.1 per cent in Seoul after President George W Bush said his administration is considering an industry bailout. BHP Billiton Ltd., the world’s largest mining company, surged 7.2 per cent on speculation a rescue will sustain demand for metals. Hanjin Shipping Co. added 12 per cent as rates for transporting commodities increased by a record.
The MSCI Asia Pacific Index climbed 4.1 per cent to 87.81 as of 7:25 p.m. in Tokyo. Almost eight stocks gained for each that declined, with all industry groups advancing. The MSCI index has rebounded 17 per cent since falling to a five-year low on October 27 as governments from Australia to the US took steps to revive their economies.
“A lot of jobs and businesses are riding on the industry’s bailout,” said Jonathan Ravelas, a Manila-based strategist at Banco de Oro Unibank Inc., which has more than $6 billion in trust assets under management. “We have seen confidence slowly creep back.”
Japan’s Nikkei 225 Stock Average added 5.2 per cent to 8,664.66, paring its annual loss to 43 per cent. On Monday’s advance was led by Denso Corp. and Aisin Seiki Co., the Japanese auto parts suppliers that sell the most to Detroit carmakers, according to UBS AG.
A surging yen and collapsing exports helped drive the Tankan measure of sentiment among the nation’s largest manufacturers down the most in 34 years, the Bank of Japan’s quarterly survey showed On Monday.
China’s stocks lagged the region’s gains after industrial production grew at the weakest pace since Bloomberg began tracking the data in 1999 and money supply expanded at the slowest rate in more than three years. Pakistan’s Karachi 100 Index lost 4 per cent after the regulator eased trading limits imposed on Aug. 27.
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The worst financial crisis since the Great Depression sent economies from the US to Japan into recession and drove MSCI’s Asian index down 45 per cent this year. Companies on the measure trade at an average 13 times estimated earnings, almost a third cheaper than at the start of 2008.
Bush said funding to rescue Wall Street firms may be used to help General Motors Corp. and Chrysler LLC. The failure of the Senate to pass a $14 billion aid package sparked a 4.2 per cent plunge on MSCI’s Asian index on Dec. 12, on concern bankruptcy by either GM or Chrysler would result in plant closures and suppliers collapsing.
Toyota rose 9.8 per cent to 3,030 yen, paring its slump this year to 50 per cent. The automaker is likely to report a second- half operating loss of more than $1 billion, the Asahi newspaper reported on December 13. Hyundai, whose biggest overseas market is the US, added 7.1 per cent to 45,000 won.
Denso surged 8.5 per cent to 1,552 yen and Aisin Seiki soared 11 per cent to 1,239 yen.
Speculation that the automakers would be bailed out led copper to gain as much as 3.3 per cent, while gold climbed 1.5 per cent.