Asian Stocks Gain Most Since April; Toyota, Samsung Advance

By Chua Kong Ho and Shani Raja
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Aug. 6 (Bloomberg) -- Asian stocks rallied the most in more than three months, led by automakers and electronics manufacturers, on speculation lower oil will slow inflation and spur consumer spending.

Toyota Motor Corp., Japan's largest automaker, and Samsung Electronics Co. gained after crude fell for a third day and the Federal Reserve left U.S. interest rates unchanged, saying price gains will ease. Sony Corp. advanced the most in two weeks after saying it will buy Bertelsmann AG's share of their music venture. Commonwealth Bank of Australia led financial companies higher. Hong Kong's market is shut because of a typhoon.

``Stocks should react favorably to the increasingly dovish monetary policy stances by central bankers around the world,'' said Prasad Patkar, who helps manage $1.8 billion at Platypus Asset Management in Sydney. ``Oil prices are in retreat and the risk of inflation is dissipating.''

The MSCI Asia-Pacific Index added 1.9 percent to 129.63 as of 7:07 p.m. in Tokyo, the biggest increase since April 21. About six stocks rose for each that fell, and all but one of the index's 10 industry groups advanced. The Philippine Stock Exchange Index climbed 3.6 percent, the region's biggest gain.

Japan's Nikkei 225 Stock Average added 2.6 percent to 13,254.89. Sanyo Electric Co., Japan's third-largest solar-cell maker, surged the most in four months after forecasting it will double its global market share by 2020. All markets in Asia open for trading rallied, apart from Pakistan.

U.S. Stocks

U.S. stocks rallied the most since April, sending the Standard & Poor's 500 Index to a 2.9 percent gain, as oil fell and the central bank forecast that inflation will ease through next year. S&P 500 index futures fell less than 0.1 percent today.

Toyota, which counts North America as its largest market, added 3.1 percent to 4,640 yen. Samsung Electronics, the world's biggest computer-memory maker, climbed 3.5 percent to 587,000 won, while Taiwan Semiconductor Manufacturing Co., the largest custom- chip maker, advanced 6.1 percent to NT$58.80.

Harvey Norman Holdings Ltd., Australia's biggest furniture and electronics retailer, jumped the most since March 2006 after the Reserve Bank of Australia yesterday signaled it may begin to cut borrowing costs. The stock gained 6.9 percent to A$3.43.

David Jones Ltd., Australia's second-largest department store chain, gained 7.5 percent to A$3.75.

Australia's central bank left its benchmark interest rate unchanged at 7.25 percent and Governor Glenn Stevens said inflation may slow, allowing for a ``less restrictive stance'' on interest rates.

`Big Relief'

Commonwealth Bank, Australia's biggest mortgage lender, advanced 6.3 percent to A$43.85, the most since March 25. Westpac Banking Corp., the nation's third-largest bank by market value, added 5.3 percent to A$22.99, the highest since May 30.

Oil dropped for a third day, by 41 cents to $119.58 a barrel at 4:58 p.m. Tokyo time. Yesterday, futures fell $2.81 a barrel on speculation demand will be reduced by economic slowdowns in the U.S. and Europe. Oil has lost more than $28 since touching a record $147.27 on July 11.

Korean Air Lines Co., South Korea's largest carrier, climbed 7.8 percent to 46,100 won, on speculation fuel costs will drop. Air China Ltd., Beijing's biggest airline, rose 1.6 percent to 9.92 yuan.

Surging fuel costs triggered Cathay Pacific Airways Ltd.'s first half-year loss in five years, the company said today. Asia's third-biggest carrier by market came up short by HK$663 million ($85 million), compared with analysts' estimates for a profit. The shares didn't trade today because of the typhoon in Hong Kong.

``A halt in crude price gains is a big relief for investors,'' said Kenji Sekiguchi, general manager of strategic research and investment at Mitsubishi UFJ Asset Management Co., which oversees $61 billion. ``If oil stays at current levels, it will no longer be among the uncertainties we are facing.''

Philippine Stocks Rise

Sony rose 5.7 percent to 4,290 yen, the most since May 15, after saying it will buy Bertelsmann's 50 percent stake in Sony BMG Music Entertainment for $900 million to gain full control of the record company, whose artists include Britney Spears and Justin Timberlake.

Sanyo Electric jumped 10 percent to 228 yen, the most since April 2, after forecasting its share of the solar-battery market will climb to 10 percent by 2020, from 4 percent in the year ended March 31.

Tomy Co. added 4.9 percent to 707 yen, the biggest advance since Feb. 14, after the Japanese toymaker yesterday almost tripled its net income outlook for the six months ending Sept. 30. The popularity of Transformers, made into a movie by Steven Spielberg's DreamWorks SKG last year, boosted sales of character goods and royalty income, a company spokeswoman said.

Globe Telecom

Globe Telecom Inc., the second-largest mobile-phone operator in the Philippines, jumped 7.9 percent to 1,225 pesos, the most since Aug. 21, after the company said it will increase dividend payments. Philippine Long Distance Telephone Co., the nation's biggest stock by market value, gained 1.8 percent to 2,570 pesos, the highest since June 3.

Mitsubishi UFJ Financial Group Inc., Japan's largest bank by market value, fell 1.2 percent to 904 yen, heading for the lowest since April 1. First-quarter profit dropped 66 percent to 51.2 billion yen ($473 million), the company said. That trailed the average estimate of 127.8 billion yen in a Bloomberg News survey of analysts.

To contact the reporter for this story: Chua Kong Ho at kchua6@bloomberg.net; Shani Raja in Sydney at sraja4@bloomberg.net