Asia stocks rise for second week on Obama win

Kuala Lumpur: Asian stocks rose for a second week, the first consecutive gain in six months, after central banks cut interest rates and Barack Obama's presidential victory in the US sparked speculation his spending plans will stimulate growth.

Mizuho Financial Group Inc jumped 20 per cent, the best week since 2003, as Japan's three-month interbank rate tumbled the most in almost a decade. Shinhan Financial Group Ltd gained 16 per cent after South Korea pledged to pump $10.5 billion (Dh38.57 billion) into its economy and the Bank of Korea lowered rates for the third time in a month. Nintendo Co, the world's biggest maker of handheld video-game consoles, rallied 7 per cent after the election of Obama, who has urged Congress to pass a $175 billion economic stimulus bill.

"The stability of financial markets has been restored somewhat," said Hideyuki Ookoshi, who helps oversee about $365 million at Chiba-Gin Asset Management Co in Tokyo. "Investors are keeping a keen eye on government efforts to shore up banks' capital, which is the key to the recovery of global econ-omies."

The MSCI Asia Pacific Index added 1.5 per cent to 87.23 in the five days to November 7. It's the first time the gauge has risen for consecutive weeks since May. A measure of financial companies climbed 5.1 per cent, the most among the index's 10 industry groups.

Japan's Nikkei 225 Stock Average rose 0.1 per cent to 8,583.00, paring earlier gains as Toyota Motor Corp lost 7.2 per cent after the automaker slashed its profit forecast by 56 per cent.

Thailand's SET Index advanced 11 per cent after protests by supporters of exiled former Prime Minister Thaksin Shinawatra ended peacefully, easing concern that political instability will continue.

MSCI's Asian index has lost 45 per cent this year, exceeding declines for benchmark indexes in the US and Europe, as the 15- month credit crisis curtailed lending, and fund redemptions and currency market volatility prompted an exodus of capital from the region.

Overnight lending

Mizuho, Japan's second-largest bank, surged 20 per cent to 278,000 yen, the biggest weekly advance since November 2003. Sumitomo Mitsui Financial Group Inc, the nation's third-largest lender, climbed 10 per cent to 420,000 yen.

The Tokyo interbank offered rate, or Tibor, fell 9.8 basis points to 0.791 per cent on November 4, the most since December 1999, according to the Japanese Bankers Association. The Bank of Japan last week cut the key overnight lending rate to 0.3 per cent from 0.5 per cent, its first reduction in more than seven years.

China Construction Bank Corp, the nation's second largest, added 6.3 per cent to HK$4.03 in Hong Kong. The city's three-month interbank offered rate declined to a six-week low on November 3.