Australian, South Korea Stocks Rise as U.S. Confidence Improves

By Shani Raja

May 4 (Bloomberg) -- Australian and South Korean stocks rose as an improvement in U.S. consumer confidence and higher metals prices stoked optimism that the global economy is recovering.

BHP Billiton Ltd., the world’s biggest mining company, rose 1.7 percent in Sydney after metals traded in London surged on May 1 and oil jumped to a five-week high in New York. Macquarie Group Ltd., Australia’s largest investment bank, slumped 6.5 percent after selling stock at a discount and reporting profit that missed its own estimate. Hong Kong and China stocks may be active after a Chinese purchasing managers index showed the country’s manufacturing industry expanded for a second month.

“Today should be all about energy and commodity plays,” said Chris Weston, an institutional dealer at IG Markets in Melbourne. “Oil plays should be in focus with strong offshore leads.”

Australia’s S&P/ASX 200 Index gained 1.3 percent to 3,820.20 as of 9:55 a.m. in Sydney. South Korea’s Kospi climbed 1.6 percent. The Japanese market is closed for a three-day holiday. Most Asian markets were closed on May 1 for May Day.

The MSCI Asia Pacific excluding Japan Index rose 1.1 percent to 284.19, taking its gain this year to 15 percent, amid speculation the worst of the global recession is over.

U.S. Standard & Poor’s 500 Index futures added 0.4 percent. The gauge rose 0.5 percent on May 1, as the Reuters/University of Michigan final index of U.S. consumer sentiment posted its second straight advance in March. A separate report from the Institute for Supply Management showed manufacturing shrank in April at the slowest pace in seven months.

Raising Capital

BHP rose 1.7 percent to A$33.56. Rio Tinto Group, the world’s third-biggest mining company, climbed 3.1 percent to A$66.14.

Crude oil for June delivery rose 4.1 percent to $53.20 a barrel in New York on May 1. In London, copper surged 3.8 percent, zinc 6.3 percent and nickel 1.9 percent.

Macquarie slumped 6.5 percent to A$31.30. The company said on May 1 that profit in the six months ended March 31 dropped 64 percent to A$267 million ($196 million) as a collapse in asset prices caused larger-than-forecast writedowns.

Macquarie also priced a A$540 million capital raising at A$27 a share, while the company’s stock rating was cut to “neutral” from “buy” in a Merrill Lynch & Co. note today.

American depositary receipts on China Mobile Ltd., the world’s largest cell-phone operator by users, climbed 1.5 percent on May 1 to the equivalent of HK$67.92. The stock closed in Hong Kong on April 30 at HK$67.30.

A China purchasing manager’s index rose to a seasonally adjusted 53.5 in April from 52.4 in March, according to May 1 statement from the Federation of Logistics and Purchasing. A reading above 50 indicates an expansion.

Stocks in Hong Kong may also be active after a 25-year-old Mexican was confirmed as the city’s first swine flu patient, prompting the city’s government to declare a public health emergency.

To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net.