Asian Chip Stocks Advance on Memory Prices; Utilities Retreat

By Patrick Rial and Masaki Kondo

Jan. 6 (Bloomberg) -- Asian chipmaker shares gained after benchmark memory prices rose for a second day, while the region’s utilities fell on concern higher oil prices will increase costs.

Samsung Electronics Co., the No. 1 maker of computer memory, rose 4.3 percent after chip prices surged to a six-week high. Canon Inc., the world’s biggest maker of digital cameras, added 3.7 percent as the yen traded near a one-month low. China Resources Power Holdings Co. and Nippon Paper Group Inc. sank after crude jumped 5.3 percent yesterday to a five-week high.

The MSCI Asia Pacific Index added 0.1 percent to 91.30 as of 2:07 p.m. in Tokyo, after losing 0.1 percent and gaining as much as 0.8 percent. The benchmark posted a record 43 percent decline in 2008 as turmoil in financial markets dragged the global economy into a recession.

“The weaker yen helps lift exporters’ earnings, while making import bills higher for domestic-oriented companies such as papermakers,” said Mitsushige Akino, who oversees about $468 million at Tokyo-based Ichiyoshi Investment Management.

The Nikkei 225 Stock Average rose 0.5 percent to 9,087.61. About half the region’s benchmarks climbed.

Samsung gained 4.9 percent to 500,000 won. Hynix Semiconductor Inc., the world’s second-largest computer-memory maker, added 4.3 percent to 7,530 won. Elpida Memory Inc., Japan’s biggest, rose 2.8 percent to 615 yen.

Yen Weakness

Prices of the benchmark dynamic random access memory chips rose 1.3 percent today, adding to yesterday’s 5.5 percent surge, to the highest since Nov. 21, according to Dramexchange Technology Inc., Asia’s biggest spot market for chips. The benchmark price plunged 62 percent last year.

Canon, which makes almost 80 percent of its sales overseas, climbed 5 percent to 2,970. Sharp Corp., Japan’s biggest maker of flat-screen televisions and solar panels, jumped 14 percent to 792 yen. Sony Corp., the world’s No. 2 maker of consumer electronics, added 7.1 percent.

The yen depreciated against the dollar to as low as 93.60 today, the weakest level since Dec. 8, from 92.03 at the 11 a.m. close of stock trading in Tokyo yesterday. A weaker yen increases the value of overseas sales when revenue is repatriated.

China Resources Power, the third-largest Hong-Kong listed Chinese utility, retreated 2.9 percent to HK$14.34. Tokyo Electric Power Co., Asia’s biggest power producer, slumped 2.7 percent to 2,865 yen. Nippon Paper, Japan’s second-largest paper producer, plummeted 10 percent to 3,220 yen. Paper producers also fell as the weaker yen raises input costs.

‘Green’ New Deal

Crude oil for February delivery gained 5.3 percent yesterday to $48.81 a barrel, the highest settlement since Dec. 1. Israeli soldiers continued to battle Hamas gunmen in the Gaza Strip, as diplomatic efforts to end the 11-day conflict failed to make headway. The Middle East is the source of one third of the world’s oil supply.

Shinsung Holdings Co., a solar-energy materials maker, soared 15 percent to 7,010 won in Seoul. NGK Insulators Ltd., the world’s only producer of sodium-sulfur batteries used to store power generated by wind turbines and solar panels, jumped 8.6 percent to 1,147 yen after a 10 billion yen ($107 million) sale of the batteries to the United Arab Emirates. Lithium-ion battery maker FDK Corp. rallied 19 percent to 182 yen.

South Korea’s “Green New Deal” will produce 956,000 new jobs over the next four years and stoke economic growth, the nation’s Ministry of Strategy and Finance said today. Japan aims to create more than 2 million jobs in the field of environmental technologies by 2015, the Nikkei newspaper said today.

Leighton, NEG

Leighton Holdings Ltd., Australia’s largest engineering and construction company, plunged 11 percent to A$25.14 after saying profit sank 60 percent in the first half as the global financial crisis forced it to write down investments.

Nippon Electric Glass Co. the world’s third-biggest supplier of glass for liquid-crystal displays, soared by its 80-yen daily limit, or 16 percent, to 579 yen. The Nikkei newspaper said the company will spend up to 3 billion yen to increase television- glass production facilities.

Toshiba Corp. rose 9.1 percent to 408 yen after its Westinghouse Electric nuclear power unit signed contracts for plants worth $7.65 billion.

Shanghai Pudong Development Bank Co. rallied 4.2 percent to 14.30 yuan after the Chinese partner of Citigroup Inc. said profit more than doubled as revenue rose by a third.

To contact the reporters for this story: Patrick Rial in Tokyo at prial@bloomberg.net; Masaki Kondo in Tokyo at mkondo3@bloomberg.net.