Asian Stocks Climb for Second Day as South Korea Supports Banks

By Patrick Rial and Satoshi Kawano

Oct. 20 (Bloomberg) -- Asian stocks advanced, boosting the benchmark index for a second day, after South Korea's government guaranteed bank debt and a possible output cut by OPEC drove oil prices higher.

Shinhan Financial Group Ltd., South Korea's second-largest financial company, rose 3.3 percent, snapping a three-day slump. BHP Billiton Ltd., Australia's biggest oil producer, climbed 5.1 percent on speculation the Organization of Petroleum Exporting Countries will reduce output targets at its meeting this week to support prices. Panasonic Corp. jumped 6.9 percent on a report profit will exceed the company's estimate.

``Company earnings may not be as bad as we feared,'' said Ryuta Otsuka, a strategist at Toyo Securities Co. in Tokyo. ``The recent declines in the stock market have already priced in possible negative results.''

The MSCI Asia Pacific Index rose 1.4 percent to 88.50 as of 9:39 a.m. in Tokyo. The gauge is still down 44 percent for the year, set for its worst annual performance since the benchmark was created in 1987. Japan's Nikkei 225 Stock Average added 1.9 percent to 8,856.52. Equity benchmarks throughout the region advanced.

U.S. stocks slipped on Oct. 17, with the Standard & Poor's 500 Index losing 0.6 percent. New home construction fell to the lowest in a quarter century, while consumer confidence dropped the most on record, sending shares lower.

To contact the reporter for this story: Patrick Rial in Tokyo at prial@bloomberg.net; Satoshi Kawano in Tokyo at Skawano1@bloomberg.net