Weaker yen boosts Japan’s exporters

Asian stocks rose as investors took heart from upbeat US economic data and favourable stress test results for US banks, while a weaker yen gave Japanese exporters an added boost.

Investor sentiment improved, taking South Korean shares to a new high, after Wall Street closed at a multiyear high. US retail sales for February rose at their fastest pace in five months, and “stress tests” showed positive results for 15 of 19 US financial groups.

The FTSE Asia Pacific index ended up 0.4 per cent at 246.71, but Tokyo’s Nikkei 225 Average outperformed the region after the yen slipped against the dollar, providing a boost for the country’s exporters.

Risk appetite increased across the region after the Federal Reserve gave a more optimistic outlook for the world’s largest economy, saying it expects “moderate” growth over coming quarters and a gradual decline in unemployment.

The Fed “seemed to subtly acknowledge the recent uptick in US economic reports. On balance, the statement does suggest a marginally diminished risk of additional policy easing from the Fed,” Omer Esiner, chief market analyst at Commonwealth Foreign Exchange, said.

In Tokyo, the Nikkei rose 1.5 per cent to 10,050.52, its first close above the 10,000 level since July.

At the top of the list were some of Japan’s top exporters as the weaker yen made their profit outlooks more attractive.

Sony, the games console maker, rose 5.2 per cent to Y1,790, while TDK, the consumer electronics group, added 5.1 per cent to Y4,505. In the same sector, Sharp gained 4.3 per cent to Y531, while Toshiba added 4.1 per cent to Y360.

Motor manufacturers were also among the top gainers. Nissan Motor rose 3.8 per cent to Y873, Toyota Motor added 2.1 per cent to Y3,485 and Fuji Heavy Industries climbed 4.5 per cent to Y673.

Financial shares gained ground on the back of the US banks’ stress test results. After markets closed in New York the Fed announced that Citigroup and three other groups had failed stress tests designed to assess whether the banks were healthy enough to return more capital to shareholders, but approved the capital plans of the other 15.

Mitsubishi UFJ Financial rallied 2.6 per cent to Y433 and Sumitomo Mitsui Financial jumped 3.9 per cent to Y291 and Shinsei Bank added 3.7 per cent to Y112.

Chinese shares slumped, however, after Beijing poured cold water on recent speculation of easing in the property sector. The Shanghai Composite slid 2.6 per cent to 2,391.2 as Poly Real Estate lost 3 per cent to Rmb11.

The Hang Seng index in Hong Kong slipped 0.2 per cent to 21,307.89. Elsewhere in the region, Australia’s S&P/ASX 200 gained 0.9 per cent to 4,287.2, while South Korea’s Kospi index climbed 1 per cent to 2,045.08 and India’s BSE Sensex index added 0.6 per cent to 17,919.3.