By Shiyin Chen and Jonathan Burgos - Dec 23, 2011 2:16 PM GMT+0700
Dec. 23 (Bloomberg) -- Patrick Bennett, a strategist at Canadian Imperial Bank of Commerce in Hong Kong, talks about the outlook for the Korean won, euro, U.S. dollar, the yen and yuan. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
Dec. 23 (Bloomberg) -- Norman Chan, head of investment at Calibre Asset Management in Hong Kong, talks about the outlook for global stocks. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
Dec. 23 (Bloomberg) -- Michael Cuggino, president of Pacific Heights Asset Management LLC, talks about the outlook for the U.S. economy, the nation's stock and bond markets, and his investment strategy. Cuggino speaks with John Dawson on Bloomberg Television's "First Up." (Source: Bloomberg)
Asian equities (MXAPJ) and South Korea’s won rose, set for weekly gains, while U.S. stock-index futures rallied and the dollar fell on signs the world’s largest economy is recovering. Mining shares climbed as China’s Yanzhou Coal (1171) Mining Co. agreed to buy Gloucester Coal Ltd.
The MSCI Asia Pacific Excluding Japan Index advanced 1.3 percent at 3:09 p.m. in Hong Kong, the highest since Dec. 13. The Shanghai Composite Index gained 0.9 percent on speculation the government will ease monetary policy and relax property curbs. Standard & Poor’s 500 Index futures increased 0.6 percent and those on the Stoxx Europe 600 Index added 1 percent. The won was up 0.5 percent and the Dollar Index slid 0.2 percent. Oil were headed for the biggest weekly rally in almost two months.
Reports today are forecast to show U.S. personal spending, durable-goods orders and new home sales rose in November, after data showed a drop in jobless claims yesterday. Moody’s Investors Service said the outlook for South Korea’s ratings remains stable after the death of Kim Jong Il, while lowering Slovenia’s credit grade, citing the potential need for the government to support banks amid Europe’s debt crisis.
“It’s encouraging that the U.S. economy is improving,” said Tim Schroeders, who helps manage $1 billion at Pengana Capital Ltd. Melbourne. “Asset prices can probably go further despite this fairly benign economic environment.”
Japan’s financial markets are closed for a holiday today. More than four shares advanced for every one that declined in MSCI’s Asia Pacific excluding Japan index, which has climbed 2.3 percent this week. The measure has dropped 17 percent this year, compared with a 0.3 percent retreat in the S&P 500 and a 13 percent loss in the Stoxx Europe 600 Index.
Stocks Rally
Australia’s S&P/ASX 200 Index rose 1.2 percent as Gloucester Coal (GCL) surged 22 percent after China’s Yanzhou Coal agreed to buy the Sydney-based company for A$2.1 billion ($2.13 billion) in cash and shares. Yanzhou Coal jumped 6.9 percent in Hong Kong. South Korea’s Kospi index increased 1.1 percent, taking its rally since Dec. 19 to 5.1 percent as concerns over political succession in North Korea eased.
Gemdale Corp. (600383) and Poly Real Estate Group Co. (600048) rallied more than 1.2 percent, helping the Shanghai Composite to its first gain this week. The Beijing government said it won’t impose property price caps and the Xinkuai newspaper reported a city in Guangdong province may allow home price restrictions to expire.
S&P 500 futures expiring in March signal the U.S. stock gauge may climb for a fourth day. Durable goods orders probably rose 2.2 percent in November, while personal spending may have increased 0.3 percent, according to the median forecasts of economists surveyed by Bloomberg. New home sales may have climbed to 315,000 last month from 307,000, the surveys show.
Signs of Strength
New unemployment claims fell by 4,000 to 364,000 in the week ended Dec. 17, the lowest level since April 2008, Labor Department figures showed yesterday.
“We’re seeing some signs of strengthening,” Michael Cuggino, president of Pacific Heights Asset Management LLC, said in a Bloomberg Television interview from San Francisco. “I’m cautiously optimistic.”
The yen headed for weekly declines against all 16 major peers. The currency traded at 78.05 against the dollar today and weakened 0.2 percent to 102.17 per euro. The euro climbed 0.3 percent to $1.3092.
The won rose to 1,150.20 against the dollar, taking its gain for the week to 0.7 percent.
“Investment sentiment is improving after U.S. data sent some signals that the world’s largest economy is holding out well,” said Hwang Sun Min, a currency dealer in Seoul at Kookmin Bank, Korea’s largest lender. “Moody’s confirmation of sovereign ratings is also helping push the won higher.”
Stability Restored
The Bank of Korea and Finance Ministry said today in a joint statement after a meeting in Seoul that they will try to reduce the won’s volatility and expand trade financing for exporters so that they can cope with the global economic slowdown. Financial markets have restored stability after Kim Jong Il’s death, according to the statement.
New Zealand’s dollar swung between gains and losses after an earthquake struck near Christchurch. The currency fell to as low as 77.23 U.S. cents before trading at 77.47 cents. It has gained 1.8 percent this week.
Oil futures in New York rose as much as 0.6 percent to $100.12 a barrel. Futures have jumped 6.7 percent this week, set for the largest increase since the five days ended Oct. 28. Copper in London gained 0.8 percent to $7,599.75 a metric ton, climbing for a fourth day, the longest increase since October. The metal is poised for a 3.5 percent rise this week, the first increase in three weeks.
The cost of protecting Australian corporate bonds from default declined, with the Markit iTraxx Australia index falling two basis points to 182 basis points, according to Australia & New Zealand Banking Group Ltd. The gauge had risen 81 basis points this year as of yesterday, CMA prices show.
To contact the reporters on this story: Shiyin Chen in Singapore at schen37@bloomberg.net; Jonathan Burgos in Singapore at jburgos4@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
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