Asian Stocks Hold Gains After Biggest Rally Since July

Asian stocks were little changed

after the region’s benchmark index yesterday completed its

steepest three-day rally since July on optimism China’s economic

reforms will boost growth. Korean equities advanced.

China Life Insurance Co., the nation’s biggest insurer,

rose 4.8 percent in Hong Kong after Citigroup Inc. named the

company as one of the beneficiaries of Communist Party policy

measures. Samsung Electronics Co. gained 1 percent as foreigners

bought a net 246 billion won ($233 million) of stocks in South

Korea’s benchmark Kospi index. Honda Motor Co., which gets 83

percent of its revenue outside of Japan, lost 1.1 percent as the

yen gained for a second day.

The MSCI Asia Pacific Index was little changed at 143.05 as

of 3:45 p.m. in Hong Kong after rising as much as 0.2 percent.

The gauge jumped 3.2 percent in the three trading days through

yesterday as China pledged to execute economic reforms and

Federal Reserve chairman nominee Janet Yellen said she would

continue U.S. stimulus.

“There’s some profit-taking pressure,” said Kenny Tang,

Hong Kong-based general manager of AMTD Financial Planning Ltd.

“But sentiment has improved a lot.”

The Hang Seng China Enterprises Index (HSCEI) of mainland companies

listed in Hong Kong added 0.6 percent, paring an earlier gain of

as much as 2.1 percent. Hong Kong’s Hang Seng Index rose 0.2

percent, while China’s Shanghai Composite Index slipped 0.2

percent.

Reform Agenda

China policy makers unveiled the biggest package of

economic reforms since the 1990s last week, with leaders in the

world’s second-largest economy vowing to allow more private

investment in state-run industries, ease the one-child policy

and expand farmers’ land rights.

“The market is still optimistic about the detailed reform

plan”, said Teresa Chow, a fund manager at RBC Investment

(Asia) Ltd., which oversees $1.5 billion. “Since Hong Kong and

China markets are underweighted by many fund managers, some of

them might want to increase their weighting.”

Japan’s Topix (TPX) index declined 0.4 percent, its first drop in

four days. The yen gained 0.2 percent to 99.84 per dollar. South

Korea’s Kospi index added 1 percent. Australia’s SP/ASX 200

Index and New Zealand’s NZX 50 Index both lost 0.6 percent.

Singapore’s Straits Times Index fell 0.3 percent, while Taiwan’s

Taiex Index rose 0.8 percent.

U.S. Futures

Futures on the Standard Poor’s 500 Index were little

changed today after the measure dropped 0.4 percent from a

record yesterday. U.S. stocks have risen for the past six weeks

as Yellen signaled she will continue stimulus efforts. New York

Federal Reserve Bank President William C. Dudley yesterday said

he’s “getting more hopeful” the U.S. economy is gaining

strength as the drag from fiscal policy wanes. The central

bank’s monetary policy is likely to be accommodative for a long

time, he said.

The Federal Open Market Committee won’t taper its purchases

until its March 18-19 meeting, according to the median estimate

of 32 economists surveyed by Bloomberg News Nov. 8.

“The direction is up for everybody,” said Mikio Kumada, a

Hong Kong-based global strategist for LGT Capital Partners. “We

are in a positive bull-market environment. The global economy is

growing, Asia has been underperforming for many years and

valuations are not expensive.”

The Asia-Pacific gauge traded at 14 times estimated

earnings as of yesterday, compared with 16.2 for the SP 500 and

15.2 for the Stoxx Europe 600 Index, according to data compiled

by Bloomberg.

To contact the reporters on this story:

Yoshiaki Nohara in Tokyo at

ynohara1@bloomberg.net;

Kana Nishizawa in Hong Kong at

knishizawa5@bloomberg.net

To contact the editor responsible for this story:

Sarah McDonald at

smcdonald23@bloomberg.net

Enlarge image

Tokyo Stock Exchange

Kiyoshi Ota/Bloomberg

A visitor looks at an electronic board displaying stock figures at the Tokyo Stock Exchange (TSE) in Tokyo.

A visitor looks at an electronic board displaying stock figures at the Tokyo Stock Exchange (TSE) in Tokyo. Photographer: Kiyoshi Ota/Bloomberg

Nov. 18 (Bloomberg) — Adrian Mowat, the Hong Kong-based chief Asia and emerging-market strategist at JPMorgan Chase Co., talks about the region’s markets and his investment strategy.

He speaks with Angie Lau and Rishaad Salamat on Bloomberg Television’s “Asia Edge.” (Source: Bloomberg)

Asian Stocks Hold Gains After Biggest Rally Since July