Chinese equities rose, with a benchmark gauge wiping out losses this year, amid expectations for a recovery in the world’s second-largest economy. Japanese shares and rubber gained after the yen touched a 20-month low.
An investor monitors stock prices at a securities exchange firm in Shanghai. Photographer: Qilai Shen/Bloomberg
China is due to release figures this week on November profit for industrial companies, following an over 20 percent surge for earnings in October. Japan’s incoming Prime Minister Shinzo Abe agreed with a coalition ally on a policy package that includes “bold monetary easing” to reach inflation of 2 percent. Japanese consumer prices excluding fresh food slid last month, economists said before data this week.
“There are growing expectations that new leaders will take measures to reform the economy and the financial system will find China new growth drivers,” said Wang Zheng, the Shanghai- based chief investment officer at Jingxi Investment Management Co., which manages $120 million. “That’s why you see all these big-caps rallying today. The ongoing economic recovery is spurring the rebound as well.”
Property developers led gains on the Shanghai Composite Index, which slipped as much as 11 percent this year. Taiwan’s Taiex Index gained 1.3 percent. Asian markets outside of Japan, China, Taiwan, Thailand, Vietnam and Sri Lanka are closed.
Company Profits
The previous corporate earnings report from China showed a 20.5 percent surge in October from a year earlier, turning positive for the year as factory output accelerated and exports picked up following a seven-quarter economic slowdown.
Wuliangye Yibin Co. (000858) paced gains for consumer-staples companies after the 21st Century Business Herald reported that the liquor maker may raise prices next year. China Vanke Co. and Poly Real Estate Group Co., the biggest Chinese developers, gained more than 6 percent after Soufun Holdings Ltd. said it sees improvement in the property market in 2013.
Almost three stocks rose for every one that fell on MSCI’s Asian gauge, with only energy shares down among the 10 main groups on the gauge.
Japan’s Topix Index, the nation’s broadest gauge of stocks, rose 0.6 percent as Japanese markets reopened after a holiday yesterday.
Weak Yen
Abe, poised to become prime minister tomorrow after elections earlier this month, said on Fuji Television on Dec. 23 that he will consider revising the law governing the Bank of Japan if the central bank doesn’t increase its inflation target to 2 percent from 1 percent at its January meeting.
“The yen has extended losses on the back of Abe’s comments,” said Toshiyuki Kanayama, a market analyst at Tokyo- based Monex Inc. “Exporters, especially auto and high-tech shares, are going to be bought as investors expect better currency margins.”
The yen rebounded to 84.78 a dollar and gained 0.2 percent to 111.76 per euro. Japan’s so-called core inflation rate slid 0.1 percent in November from a year earlier, according to the median estimate of economists in a Bloomberg News survey before the data due on Dec. 28.
Abe’s agreement with coalition ally Natsuo Yamaguchi of the New Komeito Party also calls for a “large” extra budget for the current fiscal year to March 2013 and deregulation of the energy, environment and health care sectors. The parties agreed to seek nominal gross domestic product growth of 3 percent, without giving a timeframe for the goal.
“Japan’s Abe means business this time,” Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., said in a Twitter posting. “Trillions of yen to be printed. Weak yen, positive inflation.”
Rubber for delivery in June, the most-active by volume, gained as much as 1.7 percent to 292.40 yen a kilogram on the Tokyo Commodity Exchange.
2.Located 40 km (25 miles) northwest of Yogyakarta on Java, the Borobudur is the one of the most famous Buddhist temple in the world. The Borobudur was built over a period of some 75 years in the 8th and 9th centuries by the kingdom of Sailendra, out of an estimated 2 million blocks of stone. It was abandoned in the 14th century for reasons that still remain a mystery and for centuries lay hidden in the jungle under layers of volcanic ash. Today it is one of the most popular tourist attractions in Indonesia.
3.The Komodo National Park is a national park located within the Lesser Sunda Islands that includes the three larger islands Komodo, Padar and Rincah, and 26 smaller ones. The park is named after the Komodo Dragon, the world’s largest living reptile that can reach 3 meters or more in length and weigh over 70kg. Although Komodo dragons eat mostly carcass of dead animals, they are formidable predators and will also hunt prey including birds, and mammals. Attacks against humans are very rare.
4.Lombok’s most popular tourist destination, the Gili Islands are an archipelago of three small islands: Gili Trawangan, Gili Meno and Gili Air. The islands are very relaxed and laid-back, with countless little beachside cafes still playing reggae and no cars or motorbikes to disturb the peace. Note that the name “Gili Islands” is rather redundant as gili simply means “small island” in Sasak and there are many other islands around the coast of Lombok with Gili in their names.
5.Torajaland (Tana Toraja) is a highland region of South Sulawesi, home of the Toraja people. Torajans are famous for their massive peaked-roof houses known as tongkonan and spectacular but gruesome funeral rites. After a person’s death, the body is kept – often for several years – until the actual funeral ceremony which can last for several days. The deceased is then finally buried in a small cave or in a hollow tree.
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