Asia Stocks Rise to Month-High as Naver Surges on SoftBank Talks

Feb 25, 2014 4:20 am ET

Feb. 25 (Bloomberg) -- Asian stocks rose, sending the regional benchmark index to its highest close in a month, as health-care companies and consumer discretionaries led gains. Chinese shares tumbled, led by property firms.

Naver Corp. surged 7.5 percent in Seoul as people with knowledge of the matter said a stake in the company’s Line Corp. mobile-messaging service is being sought by SoftBank Corp., which jumped 4.1 percent in Tokyo. Ramsay Health Care Ltd. rose 6.7 percent in Sydney after raising its profit forecast. HSBC Holdings Plc fell 2.7 percent in Hong Kong after profit at Europe’s largest bank missed estimates as a cost-cutting drive fell short of targets and revenue shrank.

The MSCI Asia Pacific Index climbed 0.6 percent to 137.95 as of 5:10 p.m. in Hong Kong, heading for its highest since Jan. 23. The gauge has added 2.3 percent in February, on course for its first monthly gain in four months. Data on U.S. housing reports and consumer confidence are due today, while Germany is expected to confirm that growth in Europe’s largest economy accelerated last quarter as trade expanded.

“As long as the news flow remains reasonable, we will break through new highs for global shares,” Shane Oliver, the Sydney-based head of investment strategy at AMP Capital Investors Ltd. in Sydney, which oversees $131 billion, said by phone. “The global economy looks OK. For the time being we’re still going to see more upside.”

China Developers

Stocks in Asia fell yesterday, with Chinese real estate developers tumbling amid concern some banks have tightened lending to the industry. The MSCI All Country-World Index of global developed and emerging equities rose 0.5 percent yesterday, to within 5 percent of its all-time high reached in October 2007.

Japan’s Topix index gained 1.2 percent today and South Korea’s Kospi index rose 0.8 percent. Australia’s S&P/ASX 200 slid 0.1 percent. Hong Kong’s Hang Seng Index declined 0.3 percent while Singapore’s Straits Times Index retreated 0.1 percent and Taiwan’s Taiex Index rose 0.2 percent. New Zealand’s NZX 50 Index closed little changed.

China’s Shanghai Composite slid 2 percent, its biggest drop since September, as property developers retreated and the yuan tumbled.

Housing Market

China’s Industrial Bank Co. said yesterday it will delay loans for property projects until the end of March, fueling speculation that a weaker housing market will erode demand for everything from electric appliances to cars. The yuan’s retreat threatens to raise costs for importers and companies with foreign-currency debt.

“Some investors may link the weakening of the yuan to a less optimistic outlook,” said Zeng Xianzhao, an analyst at Everbright Securities Co. in Chongqing. “Property financing curbs will probably be prolonged and other banks will follow suit. The slowdown in the property sector will spill over to other industries.”

The MSCI Asia Pacific Index climbed 6 percent from this year’s low on Feb. 4, leaving the gauge trading at 13 times the estimated earnings of its constituent companies, compared with 15.7 for the Standard & Poor’s 500 Index and 14.6 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Naver, SoftBank

Naver climbed 7.5 percent to 735,000 won and SoftBank gained 4.1 percent to 8,095 yen. Naver’s Line has received offers for all or some of the company, prompting it to slow preparations for an initial public offering, said two people who asked not to be identified as the information is private. The Tokyo-based firm, which has about 340 million users, may be worth as much as $14.9 billion, according to BNP Paribas SA.

Ramsay Health jumped 6.7 percent to A$47.54 after raising its earnings forecast for 2014. QBE Insurance Group Ltd. climbed 5.3 percent to A$12.27. Australia’s second-largest insurer by market value plans to increase premium rates and bring its North American unit back to profit this year.

HSBC Drops

HSBC lost 2.7 percent to HK$81.65. The bank, which gets most of its profit from Asia, reported pretax profit of $22.6 billion for 2013, lower than the $24.6 billion median estimate of 30 analysts surveyed by Bloomberg.

Of the 389 companies on the Asia-Pacific measure that have reported quarterly earnings since the start of the year and for which Bloomberg compiles estimates, 53 percent topped forecasts.

Casino operators climbed in Hong Kong after Barclays Plc forecast higher revenue for Macau casinos. Wynn Macau Ltd. gained 3.3 percent to HK$35.80. Sands China Ltd. gained 4.6 percent to HK$62.05. Galaxy Entertainment Group Ltd. rose 3 percent to HK$74.50.

Futures on the S&P 500 slid 0.1 percent today. The U.S. equity measure added 0.6 percent yesterday after reaching an intraday record as health-care shares jumped on a smaller-than- forecast cut in Medicare rates and EBay Inc. climbed as Carl Icahn urged a spinoff of PayPal.

--With assistance from Weiyi Lim in Singapore. Editor: Jim Powell