Asian Stocks Advance as Yen Declines With Crude Oil, Gold

Asian stocks rose, led by Japanese shares, as the yen weakened against all its major peers. Crude and gold declined, while U.S. 10-year Treasury yields touched the highest level in seven weeks.

The MSCI Asia Pacific Index added 0.4 percent as of 1:36 p.m. in Tokyo. The Topix index advanced 1.4 percent while Standard & Poor’s 500 Index (SPX) futures were little changed. The yen slid 0.3 percent to 99.48 per dollar while the Philippine peso weakened to the lowest in a month. Yields on 10-year U.S. sovereign debt touched 2.77 percent, the highest since Sept. 20. Gold lost 0.3 percent and silver headed for a three-month low, while West Texas Intermediate crude fell 0.3 percent.

President Xi Jinping and Chinese Communist Party leaders today conclude a four-day gathering to map out economic reforms after data yesterday showed the nation’s broadest measure of new credit fell by more than estimated last month. Philippine President Benigno Aquino declared a state of calamity to speed aid to communities ravaged by Super Typhoon Haiyan. Bank Indonesia will hold its key interest rate at 7.25 percent today, according to economists surveyed by Bloomberg News, while India reports industrial production and inflation data.

China’s leaders are “likely to adopt an ambitious reform agenda but much will hinge on implementation,” Michael Kurtz, the Hong Kong-based global head of equity strategy at Nomura Holdings Inc., said in an e-mail. “Our medium- to long-term optimism on Japan remains intact.”

Topix, Canon

About three stocks rose for every two that declined in the MSCI Asia Pacific Index as all 10 industry groups gained. Canon Inc., the world’s biggest camera maker, advanced 1.5 percent in Tokyo. Dentsu Inc., Japan’s biggest advertising agency, jumped 4 percent after raising its profit forecast.

South Korea’s Kospi Index added 0.7 percent. The Hang Seng Index in Hong Kong retreated 0.7 percent after surging 1.4 percent yesterday. China’s Shanghai Composite Index climbed 0.5 percent on volume that was 36 percent lower than the 30-day intraday average.

“The market is waiting for news from the plenary meeting to see if coming policies will exceed expectations,” said Wei Wei, an analyst at West China Securities Co. in Shanghai. “The rebound might be short lived unless trading volumes increase.”

Leaders may announce looser energy price controls and the break up of the domestic duopoly of PetroChina Co. and China Petroleum & Chemical Corp., according to CLSA Ltd. Energy price liberalization was mentioned last month when the Development Research Center of the State Council, a government affiliated think tank, published recommendations for reform.

Yen Slides

The yen dropped as low as 99.59 per dollar and weakened against all 16 major peers as the the gap between yields on Japanese and U.S. 30-year bonds widened to the most since 2011.

The Philippine peso weakened 0.2 percent to 43.66 per dollar following a 0.9 percent decline yesterday. The devastation from Haiyan may harm the economy, the government has said. The storm may have killed as many as 10,000 people as islands were flooded and crops damaged, with almost 9.7 million Filipinos affected, according to authorities.

Thailand’s baht gained 0.2 percent to 31.552 per dollar. Senators voted 141-0 against the draft legislation that would have provided amnesty for political offenses stretching back to the nation’s 2006 coup. The bill will be sent back to the lower house, which can resubmit it after 180 days.

Bond Yields

Australian bonds due in a decade fell for a second day, pushing yields up six basis points, or 0.06 percentage point, to 4.28 percent. The rate earlier reached 4.29 percent, the highest since March 2012.

Treasury yields rose as trading resumed after a holiday. U.S. debt with maturities longer than 10 years has slid 11 percent this year, on track for the largest loss among 144 indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies, as stronger-than-expected economic data added to the case for the Federal Reserve to reduce asset purchases.

Citigroup Inc.’s U.S. Economic Surprise Index, which shows whether data beat or fell short of economists’ forecasts, rose to 19.40 on Nov. 8, the most since Oct. 22. Fed Bank of Dallas President Richard Fisher speaks on monetary policy in Australia today.

WTI oil dropped to $94.81 a barrel, halting a two-day advance. Silver declined 1.1 percent to $21.1355 an ounce while copper futures in London lost as much as 0.5 percent to $7,135 a metric ton. Spot gold dropped to $1,279.26 an ounce.

 

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