By Jonathan Burgos and Shani Raja
March 5 (Bloomberg) -- Asian stocks gained for a second day, led by commodity and construction companies, after China’s Premier Wen Jiabao said the country’s economic growth target for this year is within reach.
BHP Billiton Ltd., the world’s biggest mining company, climbed 4.4 percent in Sydney and Komatsu Ltd., the world’s No. 2 maker of earthmoving equipment, jumped 3.8 percent in Tokyo on speculation demand for metals and industrial machinery will rise. Mazda Motor Corp., Japan’s No. 4 carmaker, surged 11 percent as the yen weakened. Hong Kong’s Hang Seng Index and U.S. futures erased gains after Wen refrained from announcing an expansion of a 4 trillion yuan ($585 billion) spending package.
“The Chinese authorities have already greased the wheels of recovery,” said Nader Naeimi, an investment strategist at AMP Capital Investors in Sydney, which manages $85 billion. “It may be a short-term disappointment that no further stimulus was announced, but it doesn’t undermine the China growth story.”
The MSCI Asia Pacific Index gained 0.6 percent to 72.70 as of 6:09 p.m. in Tokyo, after rising 2.3 percent earlier. Two stocks rose for each one that fell. The gauge slumped 49 percent in the past year as the financial crisis dragged the world’s largest economies into recession, hurting profits at companies from BHP to Toyota Motor Corp., the world’s largest automaker.
Japan’s Nikkei 225 Stock Average climbed 2 percent. All markets rose except Hong Kong, South Korea, Singapore, Indonesia, India, Pakistan and Sri Lanka. Hong Kong’s Hang Seng Index fell 1 percent, after rising 1.3 percent earlier. China’s Shanghai Composite Index rose 1 percent, paring a 2 percent gain.
Government Action
SM Prime Holdings Inc., the largest Philippine shopping mall operator, advanced 4.1 percent on optimism its expansion in China will boost earnings. Mitsui O.S.K. Lines Ltd., the world’s largest operator of iron-ore vessels, leapt 7 percent after shipping fees climbed. NEC Electronics Corp., Japan’s third- biggest chipmaker, surged 8.7 percent after Goldman Sachs Group Inc. advised investors to buy semiconductor shares.
Futures on the Standard & Poor’s 500 Index lost 0.8 percent after rising 0.5 percent earlier today. The U.S. gauge climbed 2.4 percent in New York yesterday, breaking a five-day losing streak, while Europe’s Dow Jones Stoxx 600 Index leapt 3.9 percent, the most since Dec. 8.
The MSCI Asia Pacific yesterday reversed a 1.6 percent decline to end the day 0.7 percent higher after a former Chinese statistics bureau head told reporters the premier would announce a new economic package on top of its previously announced spending plan.
Commodities Surge
Wen told delegates in his annual speech to China’s parliament in Beijing today that it’s “possible” for the economy to meet a target of 8 percent growth this year. Tumbling exports have slowed the country’s economic growth to the weakest in seven years.
Governments from China to the U.S. and Australia have sought to introduce policies this year to ease the financial crisis and bolster their economies. India’s central bank yesterday cut its key interest rate to a record low. The country’s Sensitive Index fell 3.1 percent, on concern attempts to revive the global economy will fail.
Speculation China’s economy will pick up steam drove up commodity prices yesterday. Crude oil in New York surged 9 percent to $45.38, the highest settlement since Jan. 26, while copper leapt 5.6 percent. The Reuters/Jefferies CRB Index of 19 commodities had its biggest rally this year.
BHP Billiton jumped 4.4 to A$28.31. Rio Tinto Group, the world’s third-largest miner, surged 5.2 percent to A$45.75.
Komatsu Ltd., the world’s second-biggest maker of earthmoving equipment, climbed 3.8 percent in Tokyo to 1,075 yen. Hitachi Construction and Machinery Co., the world’s largest maker of giant excavators, rose 2.7 percent to 1,246 yen.
Weaker yen
SM Prime rose 4.1 percent to 7.60 pesos in Manila, its biggest gain since Dec. 17. The company acquired three malls in China in 2007 to cut its dependence on the Philippines, where it has 33 malls.
“People are keen to see how much more money China will pump into its economy,” Mitsushige Akino, who oversees about $615 million at Tokyo-based Ichiyoshi Investment Management Co., said in an interview with Bloomberg Television. “If the country doubles its planned spending, the impact will be huge.”
Mazda Motor soared 11 percent to 137 yen after the yen depreciated against the dollar to as much as 99.53, the weakest level since Nov. 5, from 98.44 at the 3 p.m. close of stock trading in Tokyo.
Honda Motor Co., which makes 51 percent of its revenue in North America, climbed 2.5 percent to 2,260 yen. Nissan Motor Co. Ltd., Japan’s No. 3 automaker, rose 6.1 percent to 330 yen.
Baltic Dry
Mitsui O.S.K climbed 7 percent to 502 yen after the Baltic Dry Index rose 2.5 percent yesterday in London, the most since Feb. 19. Nippon Yusen K.K. advanced 4.9 percent to 405 yen, the first gain in five days.
NEC Electronics surged 8.7 percent to 537 yen. Samsung Electronics Co., the world’s largest maker of computer-memory chips, gained 2.9 percent to 503,000 won.
Profits may start improving now that the companies have pared back inventory and production, Goldman Sachs analyst James Covello wrote in a report. Semiconductor supplies were 30 percent below normal levels in January, according to Goldman estimates.
Mizuho Financial Group Inc., rose 2.8 percent to 185 yen after saying yesterday it will hold 58 percent of the company to be created through the merger of Mizuho Securities Co. and Shinko Securities Co. Shinko added 4 percent to 945 yen.
To contact the reporters for this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Shani Raja in Sydney at sraja4@bloomberg.net.
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