(Bloomberg, Oct 20, 2006) -- Asian stocks rose, set for a five- month high. Inpex Holdings Inc. and BHP Billiton advanced with the price of oil after the Organization of Petroleum Exporting Countries agreed to a bigger-than-expected cut in production.

``Crude prices and related shares have plunged quite a lot and OPEC's decision triggered some buying today,'' said Kiyoshi Ishigane, who helps oversee $61 billion in assets as senior strategist at Mitsubishi UFJ Asset Management Co. ``I'm expecting oil prices to rebound to about $63 in the next one to two months as we enter the season of higher demand.''

Posco led steelmakers higher after the Nikkei English News reported it will strengthen ties with Nippon Steel Corp., renewing speculation there may be more industry mergers. China Mobile Ltd. climbed on expectations the company will report higher third-quarter profit.

The Morgan Stanley Capital International Asia-Pacific Index climbed 0.6 percent to 131.77 as of 1:39 p.m. in Tokyo, heading for its highest since May 19. The measure has risen 1.6 percent in the past five days, set for its fourth weekly gain.

Benchmarks rose around the region, except in New Zealand and Indonesia. Exporters including Taiwan Semiconductor Manufacturing Co. gained after the Dow Jones Industrial Average closed above 12,000 for the first time on signs that expansion in the world's largest economy is helping to boost profit growth.

Japan's Nikkei 225 Stock Average rose 0.4 percent to 16,620.52 after Toyota Motor Corp. said its European sales increased, lifting shares of automakers. Gains were limited by Sony Corp., which said profit will drop to a five-year low.

Inpex, PetroChina

Inpex, Japan's largest oil explorer, added 2.1 percent to 945,000 yen. BHP, Australia's biggest oil producer and the world's largest mining company, advanced 2 percent to A$27.73. PetroChina Co., China's No. 1 oil producer, climbed 0.8 percent to HK$8.58 in Hong Kong.

Crude prices jumped as much as 1.5 percent to $59.40 a barrel in after-hours trading, adding to a 1.5 percent rally in New York yesterday. Prices gained after OPEC, which produces 40 percent of the world's oil, agreed to cut its output by 1.2 million barrels a day to stem a three-month slide. That was more than the 1 million barrels cut oil ministers has been discussing.

Crude has dropped 25 percent from a record of $78.40 reached July 14, and was recently trading at $58.87.

Sumitomo Metal Mining Co., Japan's largest gold and nickel producer, advanced 0.9 percent to 1,612 yen. Newcrest Mining Ltd., Australia's largest gold miner, gained 0.5 percent to A$22.35. Gold rose 1.7 percent to a two-week high in New York yesterday.

Steelmakers

Posco, the world's fourth-largest steelmaker, added 2 percent to 261,000 won. Posco and Nippon Steel Corp. plan to increase their stakes in each other to 5 percent as part of an expanded partnership, Nikkei English News reported, without saying where it got the information. This would cost each company as much as 50 billion yen ($423 million), Nikkei said.

The companies are in talks and nothing has been decided, said Hayato Uchida, a spokesman for Nippon Steel, the world's second-largest steelmaker. The stock rose 0.4 percent to 495 yen.

``Friendly buying of each other has the same positive effect as a share buyback,'' said Eun Sung Min, who helps manage about $4 billion at Samsung Investment Trust Management Co. in Seoul.

Australia's Bluescope Steel Ltd., which this year bought a 19.9 percent stake in Smorgon Steel Group Ltd., gained 1.6 percent to A$6.98.

China Mobil, Fairfax

China Mobile, the world's largest cell-phone operator by users, gained 1.1 percent to HK$59.30 in Hong Kong. The company may say today that third-quarter net profit climbed 24 percent to 15.9 billion yuan ($2 billion), according to an Oct. 17 report from Merrill Lynch & Co.

John Fairfax Holdings Ltd., Australia's second-biggest newspaper publisher, jumped 4.4 percent to A$4.95. Rupert Murdoch's News Corp. bought a 7.5 percent stake in Fairfax at A$5.20 a share, valuing the publisher of the Australian Financial Review at A$5.25 billion ($4 billion).

News Corp. spokesman Greg Baxter declined to comment on whether Murdoch will acquire more shares.

Taiwan Semiconductor, the world's biggest supplier of custom-made chips, added 0.8 percent to NT$61.50. Canon Inc., the biggest digital-camera maker, rose 0.8 percent to 6,480 yen.

In the U.S., the Dow climbed 0.2 percent to 12,011.73, its fifth record close in the past six days. Coca-Cola Co. reported profit that beat analysts' estimates and Lehman Brothers Holdings Inc. upgraded the telecommunication industry to ``positive'' from ``neutral,'' saying robust demand will accelerate earnings growth.

`Resilient Look'

``The stock market is a window of an economy and the U.S. economy is displaying a very resilient look,'' said Simon Chao, who helps manage $1.4 billion at President Investment Trust Corp. in Taipei. ``That also suggests U.S. consumption will continue to support Asian exporters.''

Toyota Motor Corp., the world's second-biggest automaker, gained 1.2 percent to 6,860 yen. Its European sales rose 12 percent to 870,079 vehicles this year through September, Toyota said yesterday, on the way to reaching the full-year target of 1.1 million units.

Nissan Motor Co., Japan's second-largest carmaker, gained 1.1 percent to 1,361 yen. Suzuki Motor Corp., a maker of minicars, climbed 3.4 percent to 3,320 yen.

Sony, the world's second-largest consumer-electronics maker, lost 1 percent to 4,740 yen. Net income for the year to March 31 will probably drop 35 percent, the company said yesterday. Earnings in the fiscal second quarter slid 93 percent after the company recalled notebook batteries because several burst into flames, Sony said.

Source:Bloomberg
tag:Asia