Asian Stocks Gain, Snap Four-Day Decline, as Yen Weakens

Asian stocks rose, snapping a four-day drop on the regional equities benchmark, as Japanese shares were boosted by the yen weakening against the dollar and Commonwealth Bank of Australia posted a surge in profit.

Canon Inc. gained 0.8 percent as the yen dropped, boosting the outlook for earnings at Japanese exporters. Commonwealth Bank, Australia's largest lender by market value, climbed 1.3 percent to a record after saying first-quarter cash profit jumped 14 percent on lower bad-debt charges. HTC Corp. rose 3.9 percent after analysts said the smartphone maker's fourth-quarter forecast was better than estimated.

The MSCI Asia Pacific Index gained 0.3 percent to 141.37 as of 2:32 p.m. in Hong Kong as seven of the 10 industry groups on the measure advanced. Japan's Topix index rose 0.8 percent today and is the best-performing developed equity market in 2013 amid optimism Prime Minister Shinzo Abe's policies and Bank of Japan monetary easing will stoke inflation.

"It's a very favorable state for equities," Richard Lewis, who helps oversee $261 billion as the head of global equities at Fidelity Worldwide Investment, told Bloomberg TV from Melbourne. "Japan and the Abenomics story, and the real drive to get some domestic inflation through the system, is still certainly attractive."

The MSCI Asia Pacific Index climbed 9 percent this year through yesterday amid unprecedented stimulus from Japan's central bank and optimism the Federal Reserve will continue its monthly bond buying into 2014.

Japan's Topix and Nikkei 255 Stock Average surged earlier as markets reopened after the trading break. More than 8000 Nikkei 225 futures contracts were traded in a 10-minute window ending at 12:30 p.m. local time, up from 485 in the prior 10 minutes, according to data compiled by Bloomberg. The yen declined 0.1 percent to 98.62 per dollar.

Regional Gauges

Australia's S&P/ASX 200 Index, Singapore's Straits Times Index and South Korea's Kospi index were little changed. New Zealand's NZX 50 Index advanced 0.1 percent. Taiwan's Taiex Index gained 0.2 percent.

Hong Kong's Hang Seng Index was little changed and China's Shanghai Composite Index dropped 0.6 percent.

Fed policy makers last week signaled diminishing concern over higher borrowing costs as they maintained their $85 billion in monthly bond-buying and sought more evidence of sustained growth before paring stimulus.

Of the companies on the MSCI Asia Pacific Index that have reported quarterly results this season and for which Bloomberg compiles estimates, about half exceeded analysts' estimates on profit, while 53 percent posted better-than-expected revenue.

Relative Value

The MSCI Asia Pacific Index climbed the past two months, pushing valuations on the measure to 13.6 times estimated earnings as of yesterday, up from a multiple of 12.7 at the end of August, according to data compiled by Bloomberg. That compares with a current multiple of 15.9 for the Standard & Poor's 500 Index and 14.9 on the Stoxx Europe 600 Index, the data show.

Futures on the S&P 500 added 0.4 percent today. The measure has rallied almost 24 percent in 2013, challenging 2009 for its best yearly gain in a decade. The gauge yesterday slid 0.3 percent, snapping a two-day winning streak, as investors awaited this week's data on economic growth and employment.

China's leaders meet in Beijing Nov. 9-12 to map out reforms as the world's second-largest economy heads for its slowest growth in more than two decades.

President Xi Jinping said during a visit to Hunan province that the country should speed up its strategy of using innovation to drive development and make full use of advantages to realize full-year economic targets, the official Xinhua News Agency reported.

European Growth

The European Union yesterday cut its forecast for euro-area growth next year and raised its unemployment estimate as the economy struggles to regain momentum after a record-long recession.

Commonwealth Bank rose 1.3 percent to A$77.96. Chief Executive Officer Ian Narev led the lender to unaudited cash profit, which excludes one-time items, of A$2.1 billion ($2 billion) in the three months to Sept. 30, from A$1.85 billion reported a year earlier.

Itochu Corp. (8001) rose 2.9 percent to 1,230 yen, gaining for a second day, after Japan's third-largest trading house reported record annual net income.

HTC climbed 3.9 percent to NT$146 in Taipei. The shares will react positively after slightly better-than-expected guidance for the fourth quarter and "well controlled" operating expenses, Richard Ko, a Taipei-based analyst at KGI Securities Co. wrote in a report.

Toyota Outlook

Toyota Motor Corp. erased losses, gaining as much as 1.3 percent after public broadcaster NHK said the world's largest carmaker may raise its operating-profit forecast. After the market closed, the carmaker boosted its earnings estimate.

Acer Inc. slumped 6.9 percent to NT$16.90 after the Taiwanese semi-conductor maker reported a record loss and the chairman and chief executive officer resigned.

Fast Retailing Co. (9983), Asia's biggest apparel chain, slid 0.8 percent to 32,250 yen after October same-store sales at its Uniqlo clothing stores in Japan dropped the most since 2010.

Brother Industries Ltd. tumbled 9.3 percent to 1,012 yen after the Japanese office equipment maker cut its profit forecast. Canon gained 0.8 percent to 3,090 yen.