Asian Stocks Rally on Global Output as Gold Climbs; Yen Rebounds

Bloomberg, (2/7) -- Asian stocks rose, extending the regional index’s longest stretch of gains in more than two months, on signs the outlook for manufacturing in some of the world’s biggest economies is improving. The yen strengthened, while gold climbed a third day after last quarter’s rout. The MSCI Asia Pacific Index advanced 0.9 percent by 9:57 a.m. in Tokyo, rising a fifth day and poised for the highest close since June 19 as Japanese equities drove gains. The Topix Index jumped 0.9 percent in Tokyo, while shares Australia and New Zealand rallied. The yen added 0.1 percent after retreating almost 2 percent over the past three days, while Malaysia’s ringgit and South Korea’s won strengthened. Rubber futures climbed a fourth day and other precious metals followed gold higher. Standard & Poor’s 500 Index futures rose 0.2 percent after the gauge climbed 0.5 percent in New York. Manufacturing data from the U.S., Japan and the U.K. yesterday bolstered prospects for a pickup in global growth, offsetting concerns over China, where factory output declined last month. The Institute for Supply Management’s New York factory index is due today and Australia’s central bank will probably keep interest rates at a record low, according to the median of economists’ estimates compiled by Bloomberg. “Economic fundamentals in most areas have been improving,” Angus Gluskie, managing director at White Funds Management Ltd. in Sydney, where he manages about $450 million, said by phone. “Markets have some potential to pick up from here. There’s still a degree of nervousness out there as we’re at the juncture when the Federal Reserve is signaling it may reduce stimulus measures. There’s also a clear change of policy direction in China.” More than $2.6 trillion was erased from the value of global equities last month amid speculation the Federal Reserve will curb asset purchases this year should risks to the U.S. economy continue to abate. U.S. government securities handed investors a loss of 2.5 percent in the first six months of 2013, according to Bank of America Merrill Lynch data, the biggest decline since the first half of 2009. The ISM’s U.S. factory index increased to a three-month high and exceeded the median economist estimate in June after Japan’s Tankan report signaled that manufacturers in the Asian nation were optimistic for the first time since 2011. U.K. manufacturing grew at the fastest pace in two years last month and euro-area output contracted less than initially estimated, separate reports showed. Futures on Hong Kong’s Hang Seng Index fell 0.3 percent today with trading resuming after a holiday. The Shanghai Composite Index of domestic Chinese equities advanced 0.8 percent yesterday.