Friday, 30 November 2012

Yen Falls as Price Data Fans BOJ Easing Speculation

By Masaki Kondo - Nov 30, 2012 10:47 AM GMT+0400

The yen slid to a seven-month low versus the euro after data showed Japan’s consumer prices stagnated last month, fanning speculation the central bank will increase stimulus to spur inflation.
Shinzo Abe, leader of Japan’s main opposition Liberal Democratic Party, today called for all needed measures to boost inflation to 2 percent. The dollar was near a one-month low against the euro as Democrats and Republicans wrangled over the spending cuts and tax increases of the so-called fiscal cliff looming for the U.S. in January.
“Abe’s remarks are pulling down the yen,” said Kazuo Shirai, a trader at Union Bank NA in Los Angeles. “It’s a positive that both Republicans and Democrats are negotiating over the fiscal cliff.”
The yen reached 107.30 per euro, the weakest level since April 27, before trading at 107.16 as of 6:43 a.m. in London, 0.5 percent lower than the close in New York. It fell 0.4 percent to 82.42 per dollar. The greenback lost 0.2 percent to $1.3004 per euro after touching $1.3014 yesterday, the lowest since Oct. 31.
The MSCI Asia Pacific Index of shares rose 0.5 percent, sapping demand for lower-yielding, haven currencies.
Japan’s consumer prices excluding fresh food were unchanged in October from a year earlier after a 0.1 percent decline in September, the statistics bureau said in Tokyo today. The BOJ has an annual inflation target of 1 percent.

Japan’s Elections

Abe has called for the Bank of Japan (8301) to pump unlimited cash into the financial system and said today that monetary easing may include purchases of foreign bonds. Economy Minister Seiji Maehara said earlier that concern over Japan’s economy is increasing and that he wants to cooperate with the BOJ to end deflation.
Abe’s LDP had an approval rating of 23 percent, compared with 13 percent for the ruling Democratic Party of Japan, the Nikkei newspaper reported yesterday, citing a Nov. 26-28 opinion poll. The nation will hold elections on Dec. 16 for the lower house of parliament which determines who will be prime minister.
“The yen has already entered a weakening trend,” said Akira Moroga, manager of foreign-exchange products at Aozora Bank Ltd. (8304) in Tokyo. “There are many players out there who want to buy the dollar-yen.”
The yen has fallen 3.2 percent versus the dollar in November, poised for the biggest monthly decline since February. The euro has risen 0.3 percent.

Fiscal Cliff

U.S. Treasury Secretary Timothy Geithner offered Republican House Speaker John Boehner a proposal to avert an end-of-the- year fiscal cliff that would trade $1.6 trillion in tax increases for $400 billion in unspecified entitlement-program cuts, a Republican aide said, who wasn’t authorized to speak publicly.
After meeting Geithner yesterday, Boehner said President Barack Obama must “get serious” about the fiscal cliff talks. Senate Majority Leader Harry Reid, a Nevada Democrat, said Democrats need a proposal from Republicans on what sort of spending cuts they want.
The Dollar Index (DXY) fell 0.1 percent to 80.121, sliding for a third day. The gauge has reached the support zone of 80 to 79.65, which includes the 50 percent and 61.8 percent retracements from the Nov. 16 high to the Sept. 14 low, according to Niall O’Connor, a New York-based technical analyst with JPMorgan Chase & Co.
“Breaks here are necessary to confirm a deeper pullback and retest of the range lows,” the analyst wrote in a research note yesterday.

German Vote

German lawmakers will vote today to ratify an amended aid plan to Greece after euro-area finance ministers agreed to ease terms of emergency bailout loan for the debt-saddled nation.
“Germany should give parliamentary approvals to the new Greek debt deal later today which may also help sentiment towards the euro,” Ray Attrill, Sydney-based global co-head of currency strategy at National Australia Bank, wrote in a research note.
The one-year, 25-delta risk-reversal rate for the euro reached minus 1.2975 percent today, the highest since October 2010, signaling reduced demand for the right to sell the common currency against the dollar. It was at minus 3.3425 percent at the beginning of this year.
To contact the reporter on this story: Masaki Kondo in Singapore at
To contact the editor responsible for this story: Rocky Swift at

Asian Currencies Approach 15-Month High on U.S. Budget Optimism

By David Yong & Liau Y-Sing - Nov 30, 2012 8:06 AM GMT+0400

Asian currencies gained for a second week, approaching an almost 15-month high, as optimism that U.S. lawmakers will resolve the nation’s budget deadlock supported demand for emerging-market assets.
Democratic Senator Chuck Schumer said yesterday there’s been progress in talks to avert $607 billion in spending cuts and tax increases as President Barack Obama said this week he hopes for an agreement before Christmas. India’s rupee was headed for its best week since October after Moody’s Investors Service affirmed its stable rating outlook, Indonesia’s rupiah ended a six-week slump and China’s yuan traded at 19-year high. The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding Japan, advanced for a sixth month.
“The biggest driver is the U.S. fiscal situation,” said Sean Yokota, the Singapore-based head of Asia strategy at Skandinaviska Enskilda Banken AB. (SEBA) “If you look at a one-month time horizon, we think they’ll reach a deal on the fiscal cliff, so Asian currencies will probably continue to appreciate.”
The rupee rallied 1.9 percent from a week ago to 54.45 per dollar as of 9:22 a.m. in Mumbai, according to data compiled by Bloomberg. The rupiah gained 0.5 percent to 9,603, and the ringgit strengthened 0.4 percent to 3.0443. South Korea’s won rose 0.3 percent to 1,082.93.
Global investors added $827 million of new money into emerging-market bond funds in the week through Nov. 28, according to EPFR Global data. Foreigners were net buyers of stocks in India,Philippines, Taiwan and Thailand this month. Investors bought an extra $167 million of sovereign debt in Indonesia this week, government data showed.

India Ratings

“Optimism about the global economy is spurring demand for emerging-market debt, including Indonesia’s, which supports the rupiah,” said Gusti Kahari, a foreign-exchange dealer at PT Bank Artha Graha Internasional in Jakarta.
The Asia Dollar Index has climbed 3.7 percent since May as European leaders pledged to support Greece and amid signs of an economic rebound in China. It touched 118.26 today, the highest level since Sept. 13, 2011. The gauge’s 60-day historical volatility fell to 2.19 percent from 2.21 percent on Nov. 23.
Moody’s said on Nov. 26 its outlook on India’s Baa3 sovereign credit rating remains stable as Asia’s third-largest economy recovers amid strong investment gains. Gross domestic product may have expanded 5.5 percent in the three months through September, Finance Minister Palaniappan Chidambaram said Nov. 24, matching the preceding quarter’s growth rate. Economists forecast a 5.3 percent increase, according to the median estimate in a Bloomberg survey before data due today.

China PMI

An official report tomorrow on China’s Purchasing Managers’ Index may show manufacturing expanded for a second month in November, according to a separate Bloomberg survey.
The yuan gained 0.04 percent this week to 6.2263 per dollar, according to China Foreign Exchange Trade System. It touched a 1993 high of 6.2223 on Nov. 27 and tested the upper- limit of its trading band on each of the five days.
“There’s pent-up demand for the yuan,” said Andy Ji, a Singapore-based foreign-exchange strategist at Commonwealth Bank of Australia. (CBA) The currency is also supported by a trade surplus that has surpassed $180 billion this year, he said.
Elsewhere, the Philippine peso appreciated 0.4 percent from a week ago to 40.895 before a public holiday today. Thailand’s baht was steady at 30.70 per dollar, as was Vietnam’s dong at 20,855. Taiwan’s dollar climbed 0.3 percent to NT$29.08 per dollar, its second weekly advance.
To contact the reporters on this story: David Yong in Singapore at
Liau Y-Sing in Kuala Lumpur at
To contact the editor responsible for this story: James Regan at

ECB Withholding Secret Greek Swaps File Keeps Taxpayers in Dark

By Gabi ThesingElisa Martinuzzi & Alan Katz - Nov 30, 2012 4:01 AM GMT+0400

The European Central Bank’s court victory allowing it to withhold files showing how Greeceused derivatives to hide its debt leaves one of the region’s most powerful institutions free from public scrutiny as it assumes even more regulatory power.
The European Union’s General Court in Luxembourg ruled yesterday that the central bank was right to keep secret documents that would reveal how much the ECB knew about the true state of Greece’s accounts before the country needed a 240 billion-euro ($311 billion) taxpayer-funded rescue.
ECB Withholding Secret Greek Swaps File Keeps Taxpayers in Dark
A Euro sign sculpture is seen illuminated at night outside the European Central Bank's (ECB) headquarters in Frankfurt, Germany. Photographer: Hannelore Foerster/Bloomberg
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The case brought by Bloomberg News, the first legal challenge to a refusal by the ECB to make public details of its decision-making process, comes a month before the central bank is due to take responsibility for supervising all of the euro- area’s banks. The central bank already sets narrower limits on its disclosures than its U.S. equivalent, the Federal Reserve. The court’s decision shows the ECB has too broad a discretion to reject requests for disclosure, academics and lawyers said.
“It’s a very disturbing ruling,” said Olivier Hoedeman of Corporate Europe Observatory, a Brussels-based research group that challenges lobbying powers in the EU and campaigns for the accountability of EU bodies. “It is such a sweeping, blanket statement that it undermines the right to know.”
Bloomberg sought access to two internal papers drafted for the central bank’s six-member Executive Board. The first document is entitled “The impact on government deficit and debt from off-market swaps: the Greek case.” The second reviews Titlos Plc, a structure that allowed National Bank of Greece SA, the country’s biggest lender, to borrow from the ECB by creating collateral from a securitization of swaps on Greek sovereign debt. The bank loaned 5.4 billion euros to the government.

Mario Draghi

ECB President Mario Draghi said on Oct. 4 that the ECB “is already a very transparent institution,” citing the fact that he holds a monthly press conference after its rate decision, testifies to lawmakers, gives interviews and makes speeches.
In yesterday’s decision, the court upheld the ECB’s opinion that the documents sought by Bloomberg could damage the public interest and aggravate Europe’s financial crisis.
“The ECB must be recognized as enjoying a wide discretion for the purpose of determining whether the disclosure of the documents relating to the fields covered by that exception could undermine the public interest,” the three judges said in their ruling. Exceptions “must be interpreted and applied strictly,” they said. An ECB spokeswoman said the central bank welcomed the court’s decision.

‘Dummy Standard’

Since Bloomberg made its request in August 2010, the ECB granted itself additional scope to withhold information if the stability of the financial system or a member state could be undermined. The power was added after the ECB was chosen by the European Parliament to chair the European Systemic Risk Board, a pan-EU supervisor that monitors markets and financial risk.
“This is a dummy standard which means whatever it wants it to mean and the courts grant it a margin of interpretative discretion,” said Gunnar Beck, a barrister and a reader in EU law at the University of London. “The ECB is becoming less transparent, even though it pays lip service to it.”
The ECB is under pressure from some policy makers to become more open as it embarks on more so-called non-standard measures aimed at staunching Europe’s crisis. The Frankfurt-based authority has been central to keeping Greek banks alive since the crisis began, providing loans and at times risking European taxpayers’ money in event of an outright default. The central bank owns about 45 billion euros of Greek government bonds, according to data compiled by Bloomberg.

‘Step Forward’

Governing Council member Erkki Liikanen said on Sept. 21 it was no longer sufficient for the ECB to publish just its decisions, but that it needed to “take one step forward and also describe the conversation, what each member has said.”
Unlike the Federal Reserve, the ECB doesn’t publish minutes of its discussions in the run up to a decision on interest rates or non-standard measures for 30 years, arguing that secrecy is necessary to shield its officials from political pressure in their home countries. Instead, Draghi holds a monthly press briefing after the rate decision.
The Federal Open Market Committee meets eight times a year in Washington. At every other meeting, Chairman Ben S. Bernanke holds a press conference following the release of the Fed’s statement to explain the actions. Minutes of each meeting, which summarize the discussions that took place, are released with a three-week lag and transcripts are published five years later.
In Europe, internal dissent only reaches the public if a member chooses to go public, as was the case with Jens Weidmann, the Bundesbank president who has publicly opposed the ECB’s program to buy the government bonds of Spain and Italy if they request it. Weidmann said he wasn’t the only policy maker to have concerns about the proposal.

Fed Documents

The ECB’s stance contrasts with the Fed, which has moved toward greater transparency, in part under pressure from the U.S. Congress and a lawsuit by Bloomberg News, said Roberto Perli, a former economist for the Federal Reserve’s Division of Monetary Affairs and a managing director at International Strategy & Investment Group in Washington.
Congress, through the Dodd-Frank Act, forced the Fed to reveal details of its lending through its discount window with a two-year delay. The Fed argued disclosure would stop banks from using the facility. The first release under the act was in September.

FOIA Request

That followed the Fed’s release in March 2011 of more than 29,000 pages of documents, covering the discount window and several Fed emergency-lending programs established during the crisis from August 2007 to March 2010 after court orders upheld Freedom of Information Act requests filed by Bloomberg and News Corp.’s Fox News Network LLC.
“Of course it may be crucial to keep some market-sensitive information under wraps” to stop a run on a bank, said Petra Geraats, an economics lecturer Cambridge University who specialises in central bank transparency. “But when the ECB uses such an argument for two-year-old documents, claiming they could aggravate the crisis, one wonders what skeletons are still hidden in the ECB’s closets.”
The case is: T-590/10, Thesing and Bloomberg Finance v. ECB.
To contact the reporter on this story: Elisa Martinuzzi in Milan at
Gabi Thesing in London at gthesing@bloomberg.netAlan Katz in Paris at
To contact the editors responsible for this story: Edward Evans at

Thursday, 29 November 2012

European Stock Futures Little Changed Near 17-Month High

By Jonathan Morgan - Nov 30, 2012 11:16 AM GMT+0400

European stock futures were little changed after the Stoxx Europe 600 Index climbed to the highest level in 17 months as investors awaited a report on American consumer spending. Asian shares rose while U.S. futures fell.
TNT Express NV (TNTE) may move as United Parcel Service Inc. made concessions to European Union regulators reviewing its 5.16 billion-euro ($6.7 billion) takeover. Hugo Boss AG (BOSS), the German luxury-clothing maker controlled by Permira Advisers, may drop after Goldman Sachs Group Inc. downgraded the stock.
Former ECB Executive Board Member Jose Manuel Gonzalez-Paramo
Jose Manuel Gonzalez-Paramo, former member of the executive board of the European Central Bank (ECB), said Spain may escape a bailout, as the country has already confounded expectations by continuing to raise its own financing this year. Photographer: Peter Foley/Bloomberg
Futures on the Euro Stoxx 50 Index (SX5E), a benchmark for the euro area, rose less than 0.1 percent to 2,580 at 7:14 a.m. in London. Contracts on the U.K.’s FTSE 100 Index fell less than 0.1 percent. Standard & Poor’s 500 Index futures dropped 0.1 percent, while the MSCI Asia Pacific Index rose 0.4 percent.
Congressional Republicans dug in to fight President Barack Obama’s plan to avoid the so-called fiscal cliff. Republicans complained that a plan outlined yesterday by Treasury Secretary Timothy Geithner was little more than a rehash of old proposals, setting the stage for more contentious negotiations over the coming weeks as the year-end deadline approaches for more than $600 billion in spending cuts and tax increases to kick in.
Obama is scheduled to visit a manufacturing plant in Hatfield, Pennsylvania, today to emphasize his call for an extension of George W. Bush-era tax rates for middle-income households. Speaker of the House John Boehner said to reporters in Washington yesterday that there’s been “no substantive progress” in budget talks.

‘Discordant Headlines’

“Traders are becoming numb to the discordant headlines and instead treading cautiously,” Jonathan Sudaria, a trader at Capital Spreads in London, wrote in an e-mail.
Spending by U.S. consumers probably stagnated in October as income gains slowed and superstorm Sandy deterred those in the Northeast from shopping at malls and car dealerships, economists said before a report today.
Household purchases were unchanged last month, the weakest reading since June, after advancing 0.8 percent in September, according to the median estimate of 79 economists surveyed by Bloomberg. The report may also show incomes grew 0.2 percent after increasing 0.4 percent in September.
Former European Central Bank Executive Board member Jose Manuel Gonzalez-Paramo said Spain may escape a bailout, as the country has already confounded expectations by continuing to raise its own financing this year.

‘Good News’

“It is by no means excluded that a bailout will not be requested, if a sequence of good news is produced in terms of the deficit and other things,” Gonzalez-Paramo, 54, said in an interview with Bloomberg Television in London yesterday.
TNT Express may move. UPS, the world’s biggest package- delivery company, made concessions to regulators reviewing its purchase of TNT Express, a deal that would double its size in Europe. The proposed remedies include the sale of some business units and the granting of access to air networks to competitors, the companies said in a joint statement. The deadline for the European Commission’s investigation was extended to Feb. 5.
Hugo Boss may decline after Goldman Sachs downgraded the stock to neutral from buy.
Galp Energia SGPS SA (GALP), Portugal’s biggest oil company, may be active as UBS added the stock to its most preferred list.
To contact the reporter on this story: Jonathan Morgan in Frankfurt
To contact the editor responsible for this story: Andrew Rummer at

Wednesday, 28 November 2012

Dollar Trades Near November Low Before Geithner Discusses Cliff

By Masaki Kondo - Nov 29, 2012 8:20 AM GMT+0400
The dollar was 0.4 percent from the lowest this month versus the euro before Treasury Secretary Timothy F. Geithner meets congressional leaders to discuss the so-called fiscal cliff.
The Dollar Index declined for a second day after comments from U.S. lawmakers fueled optimism the $607 billion combination of tax increases and spending cuts due to take effect in January will be avoided. The yen fell versus most major peers as Asian stocks gained before data forecast to show the U.S. gross domestic product expanded faster than previously estimated.
“The fiscal cliff can be a selling catalyst for the dollar,” said Kengo Suzuki, a currency strategist in Tokyo at Mizuho Securities Co., a unit of Japan’s third-largest bank by market value. “The U.S. GDP figure will be positive for risk sentiment, spurring yen selling.”
The dollar traded at $1.2954 per euro as of 1:13 p.m. in Tokyo from $1.2953 in New Yorkyesterday. It touched $1.3009 on Nov. 27, the weakest since Oct. 31. The yen was little changed at 106.37 per euro and 82.12 versus the greenback.
The Dollar Index (DXY), which IntercontinentalExchange Inc. uses to track the greenback against currencies of six U.S. trading partners, fell 0.1 percent to 80.277. The MSCI Asia Pacific Index (MXAP) of shares rose 0.8 percent, sapping demand for lower- yielding, haven assets.

‘Gyrating’ Sentiment

Geithner will meet separately with each of the four top leaders in Congress today. House Speaker John Boehner said yesterday he is “optimistic” lawmakers engaged in budget talks can avert the crisis.
“Markets are becoming increasingly headline driven, with risk appetite gyrating on any fresh lead on fiscal cliff developments,” Mitul Kotecha, the Hong Kong-based global head of foreign-exchange strategy at Credit Agricole Corporate and Investment Bank, wrote in a research note today. “Currencies will continue to track the gyrations in risk, but in large part remain in well-defined ranges.”
The JPMorgan G7 Volatility Index, derived from premiums on currency options, was at 7.33 percent after touching 7.08 percent on Nov. 20, the lowest since August 2007.
The U.S. economy probably grew at an annualized 2.8 percent in the third quarter, according to the median estimate of economists surveyed by Bloomberg News before the figures due today. The initial reading from the Commerce Department last month showed a 2 percent increase.

European Economy

The yen has lost 2.9 percent against the dollar since the end of October, set for the biggest monthly slump since February. The euro is little changed in November.
The European Commission is likely to confirm today that a gauge of the euro area’s consumer confidence slid to the lowest in more than three years as the region’s prolonged debt crisis weighed on growth. The index fell to minus 26.9 this month from minus 25.7 in October, economists forecast, matching the figure released a week ago that was the lowest since May 2009.
Moody’s Investors Service said in a report today that Greece’s debt burden remains unsustainable even after European finance ministers decided to ease bailout terms and release funds to the nation.
“Compared with the U.S., Europe’s economy is clearly in bad shape,” said Masato Yanagiya, head of currency and money trading in New York at Sumitomo Mitsui Banking Corp., a unit ofJapan’s second-biggest listed financial group by market value. “Looking at those fundamentals, the euro will be sold against the dollar over the longer term.”
To contact the reporter on this story: Masaki Kondo in Singapore at
To contact the editor responsible for this story: Rocky Swift at

SNB’s Jordan Says High Swiss Franc Burdens Many Companies

By Zoe Schneeweiss - Nov 29, 2012 3:00 AM GMT+0400

Swiss National Bank President Thomas Jordan said the franc remains high and weighs on companies in Switzerland.
“The franc at its current level still has a high value,” Jordan said in Bern late yesterday. “This burdens a lot of companies -- especially in a phase of moderate global economic growth.”
The SNB, which introduced a minimum exchange rate of 1.20 francs per euro in September 2011, has piled up foreign-currency reserves worth 424 billion francs ($454 billion) defending that ceiling. The SNB has enforced this franc cap “with determination and is prepared to buy foreign currency in unlimited quantities,” Jordan said yesterday.
“The franc is seen as a safe harbor in the storm,” he said, adding that the minimum exchange rate has shielded Switzerland from “major damage” and remains the right and necessary measure for the SNB to fulfill its mandate of price stability.
The franc appreciated 0.1 percent yesterday to 1.20302 per euro, the strongest level since Sept. 5.
Still, “the minimum rate is a response to exceptional circumstances and is not a remedy for problems of any kind or an instrument to fine-tune the economy,” Jordan said.

‘Substantial Risks’

The expansion of the SNB’s balance sheet, which is five times the size it was in June 2007, has created “substantial risks,” he said. “We have to expect that because of the new size and structure of the balance sheet, fluctuations in value may be much greater in the future than they have been in the past.”
At the same time, the idea of creating a sovereign wealth fund for managing the SNB’s currency reserves isn’t ideal as it “would not facilitate monetary policy with regard to the enforcement of the minimum exchange rate,” he said.
“The current size and composition of the central bank balance sheet are a direct reflection of monetary policy,” Jordan said. “If limitations were placed on the SNB balance sheet, its room for maneuver in the monetary-policy domain would be restricted.”
To contact the reporter on this story: Zoe Schneeweiss in Zurich
To contact the editor responsible for this story: Craig Stirling at

Asian Stocks Rise on U.S. Budget Remarks, Japan Stimulus

By Adam Haigh - Nov 29, 2012 6:25 AM GMT+0400

Asian stocks rose as U.S. lawmakers said they’re optimistic for an agreement to avoid automatic spending cuts and tax increases and as the leader of Japan’s opposition party called for unlimited monetary policy easing.
Toyota Motor Corp. Asia’s biggest carmaker, gained 0.7 percent. Sky Network Television Ltd., New Zealand’s largest pay TV operator, jumped the most in more than a year in Wellington after the company announced payment of a special dividend. Starpharma Holdings Ltd. (SPL)tumbled 31 percent in Sydney as the biotechnology company said it won’t file a drug application in the U.S. following a disappointing clinical trial for a new treatment.
Asian Stocks Rise on U.S. Budget Remarks, Japan Stimulus Calls U.S. President Barack Obama, center, speaks during a cabinet meeting while Hillary Clinton, secretary of state, left and Leon Panetta, secretary of defense, listen at the White House in Washington, D.C., U.S., on Wednesday, Nov. 28, 2012. Photographer: T.J. Kirkpatrick/Bloomberg
The MSCI Asia Pacific (MXAP) Index gained 0.5 percent to 123.72 as of 11:21 a.m. in Tokyo. The gauge rose 13 percent through yesterday from this year’s low on June 4 as central banks added stimulus to spur growth and data showed a slowdown in China may be ending.
“Market expectations are that the U.S. cutbacks will be watered down and spread over several years,” said Matthew Sherwood, Perpetual Investment’s head of markets research in Sydney. Perpetual manages about $25 billion. “If the cliff is successfully flattened out over several years, the U.S. recession feared by markets is unlikely to occur.”
Japan’s Nikkei 225 Stock Average (NKY) gained 0.7 percent, with trading volume 18 percent below its 30-day average for the time of day, according to data compiled by Bloomberg. The broader Topix Index rose 0.8 percent. The Topix may surge 19 percent in 2013 on compelling valuations and earnings, Goldman Sachs Group Inc. strategist Kathy Matsui wrote in a report today.

Abe Comments

There’s “scope for additional monetary easing ahead,” Matsui wrote. Next year “will provide a more favorable backdrop for Japanese equities than the multiple headwinds of 2012.”
Japan’s main opposition Liberal Democratic Party leader Shinzo Abe wants unlimited easing of monetary policy from the Bank of Japan until inflation reached 2 percent, he said in Tokyo today. The Topix advanced 6.8 percent through yesterday from Nov. 14, when Prime MinisterYoshihiko Noda called for a Dec. 16 election, causing the yen to drop on speculation the opposition LDP may win and call for more monetary easing by the Bank of Japan.
Hong Kong’s Hang Seng Index rose 0.5 percent and the Shanghai Composite Index was little changed. South Korea’s Kospi Index (KOSPI) advanced 0.9 percent, Singapore’s Straits Times Index rose 0.6 percent and Taiwan’s Taiex gained 0.9 percent.

Australia Homes

Australia’s S&P/ASX 200 Index gained 0.5 percent as a report showed Australian sales of newly built homes rose for the first time in four months in October indicating the central bank’s interest-rate reductions are luring buyers.
Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The S&P 500 rose 0.8 percent yesterday, reversing earlier declines, as Republican House Speaker John Boehner said he is optimistic that budget talks can avert more than $600 billion in automatic tax increases and spending cuts next year.
President Barack Obama is sending Treasury Secretary Timothy F. Geithner to meet congressional leaders today to discuss the issue.
Carmakers accounted for the largest gains on the MSCI Asia Pacific Index. Toyota Motor gained 0.7 percent to 3,500 yen. Kia Motors Corp. (000270) advanced 4.6 percent to 61,900 won and Hyundai Motor Co. climbed 2.9 percent to 231,000 won in Seoul on expectations sales in the so-called BRIC countries of Brazil, Russia, India and China, will increase.

Luk Fook

Sky Network Television advanced 3 percent to NZ$5.22, heading for the largest gain since October 2011. Sky will make a 32 New Zealand cents-a-share distribution next month, the Auckland-based company said in a statement.
Luk Fook Holdings Ltd. (590) soared 5.2 percent to HK$22.10 after profit at the jeweler topped estimates. Rival Chow Tai Fook Jewellery Group Ltd. advanced 3.7 percent to HK$10.68.
Aristocrat Leisure Ltd. gained 4.5 percent to A$3.18, heading for its biggest three-day rally in nine months. Credit Suisse Group AG (ALL) upgraded its recommendation on shares of the gaming machine maker after the company yesterday reported full- year profit that topped forecasts.
Starpharma slumped 31 percent to A$1.11, a record slide, after a late-stage trial found the biotechnology company’s VivaGel product failed to cure women of a vaginal infection. Starpharma won’t be seeking U.S. approval now for VivaGel as a treatment.
To contact the reporter on this story: Adam Haigh in Sydney at
To contact the editor responsible for this story: Nick Gentle at