Asian mkts recover

GLOBAL MARKETS

Asian stocks rose, recovering from earlier losses, after higher profits from Astellas Pharma and Chi Mei Optoelectronics helped counter concern that the US subprime loans crisis is spreading.

Fast Retailing, Asia's largest clothing retailer, rose after its $900 million bid for a New York chain was accepted. Taiwan Life Insurance slumped after reporting a hedge fund loss. Mizuho Financial Group paced a decline in Japanese banks for a second day after first-quarter profit fell.

The Morgan Stanley Capital International Asia Pacific Index added 0.2 per cent to 151.75 in Tokyo, after earlier gaining 0.8 per cent and dropping 1.4 per cent. The measure slid yesterday to its lowest since June 27 after Macquarie Bank and Bear Stearns said funds may post losses.

"The markets are bungee-jumping as they sort out the problems about the US subprime problems,'' said Winson Fong, who helps oversee about $2.5 billion at SG Asset Management in Hong Kong. The question on everyone's mind is whether investor confidence can be maintained.''

Europe

European stocks advanced after Credit Suisse Group, Societe Generale and Unilever reported earnings that beat analysts' estimates and shares rallied in the US market yesterday.

Credit Suisse, Switzerland's second-largest bank, and Societe Generale led the Dow Jones Stoxx 600 Banks Index higher. Unilever headed for its biggest gain since March 2003.

US stocks climbed yesterday after a surge in computer and consumer shares lifted the Dow Jones Industrial Average 150 points in the last 20 minutes of trading. Asian stocks rose today after higher profits from Astellas Pharma and Chi Mei Optoelectronics helped counter concerns that the rout in US subprime mortgages is spreading.

US

US stock-index futures retreated after Taiwan Life Insurance wrote off a hedge-fund investment backed by subprime loans, reigniting concern that credit-market losses may spread.

Citigroup, the biggest US bank, and JPMorgan, Chase, the third-largest, declined in Europe. Shares of Mattel fell after the biggest toymaker said it's recalling 1.5 million children's products.

Standard & Poor's 500 Index futures expiring in September slipped 3.8 to 1,466.10 in London. Dow Jones Industrial Average futures lost 35 to 13,369 and Nasdaq 100 Index futures decreased 7.50 to 1953.

A rally in computer and consumer shares in the last 20 minutes of trading yesterday lifted stocks to close higher. In earlier trade, indexes declined on concern losses from investments backed by subprime loans are spreading after Bear Stearns suspended withdrawals from a hedge fund.

"We're focused on subprime and credit risk,'' said Jacques Porta, who helps manage $180 million at Ofivalmo Patrimoine in Paris. "The market is being carried by the strong surge of risk aversion. People are saying: If Bear lost a lot, other investment banks must have as well.''