ROME: Asian stocks climbed after signs of stabilization in global manufacturing activity helped drive the Standard & Poor’s 500 Index to levels not seen since before China’s yuan devaluation in August. Australia’s dollar extended gains as the central bank held interest rates steady.
The MSCI Asia Pacific excluding Japan Index rose for the first time in six days amid signs of resilience in U.S. and European manufacturing and after measures of factory activity in China stabilized, albeit at levels denoting contraction. S&P 500 futures fluctuated after the gauge jumped 1.2 percent. The Aussie rose for a third day, while the Bloomberg-JPMorgan Asia Dollar Index was headed for its highest close in a week.
“The area of weakness has been China, as long as we can see there’s stability in China’s economy, markets will continue to rally,” Angus Gluskie, a managing director who oversees $550 million at White Funds Management Ltd. in Sydney, said by phone.
China’s surprise currency move on Aug. 11 ignited the most volatile quarter for global markets since 2011 and led to the Federal Reserve citing the risks to global financial markets in its September decision to hold rates near zero. The focus now is firmly on central banks, with Japan and Europe indicating they’ll hold fast to stimulus amid increasing bets on the Fed raising rates before the end of 2015. Payrolls data due later this week will be key to determining the path of U.S. monetary policy.
Stocks
The MSCI Asia Pacific excluding Japan Index added 0.7 percent by 12:37 p.m. Tokyo time. Even after posting its best monthly performance since 2012 in October, the index is still 4.2 percent below its closing level on Aug. 10, the day before China cut the value of the yuan. MSCI’s Asia Pacific gauge, which includes Japanese equities, is down 3 percent this year.
Australia’s S&P/ASX 200 Index rose 1.1 percent in Sydney, after sinking the most since Sept. 29 on Monday. The Kospi index in Seoul climbed 0.5 percent, while New Zealand’s S&P/NZX 50 Index added 0.4 percent, rising for the first time in three days and returning to a record high.
The Hang Seng China Enterprises Index climbed 1.2 percent after a five-day, 4.7 percent slide. The Hang Seng Index rose 1.3 percent. China’s Shanghai Composite Index fluctuated.
“The savage selling yesterday particularly looked to be overdone,” Evan Lucas, a markets strategist in Melbourne at IG Ltd., said in an e-mail to clients.
Futures on the S&P 500 swung between gains and losses after the index closed at 2,104.05, the highest since Aug. 10. Nasdaq 100 Index futures also rose 0.1 percent, indicating the technology-heavy measure may extend gains Tuesday from a 15-year high. Contracts on London’s FTSE 100 Index added 0.5 percent.
