MSCI gains as earnings offset growth concerns

Singapore: Asian stocks rose last week, driving the MSCI Asia Pacific Index to its sixth advance in seven weeks, as better-than-estimated earnings from CNOOC to Westfield Group offset concerns the global recovery is faltering.

CNOOC, China's biggest offshore oil producer, advanced 3.4 per cent last week in Hong Kong. Westfield, the world's largest owner of shopping malls, rose 1.1 per cent in Sydney. Tokyo Electron, the world's second-biggest producer of chipmaking equipment, climbed 2.7 per cent in Tokyo after larger rival Applied Materials forecast higher-than-estimated profit.

"I'm telling people not to be too pessimistic," said Kenji Sekiguchi, general manager of strategic research and investment at Mitsubishi UFJ Asset Management, which oversees about $73 billion (Dh267.91 billion) in Tokyo. "The market in the second half of this year will reflect positive earnings more explicitly than the latest earnings season."

The MSCI Asia Pacific Index gained 0.4 per cent this week to 118.29, following last week's 3.7 per cent retreat. The index has slumped about 8.4 per cent from its high this year on April 15 as Europe's debt crisis, China's measures to curb property-price inflation and disappointing economic reports in the US fuelled concern global growth may stall.

China

China's Shanghai Composite Index advanced 1.4 per cent this week as the nation's economy surpassed Japan as the world's second largest last quarter. Japan's Nikkei 225 Stock Average fell 0.8 per cent.

Australia's S&P/ASX 200 Index fell 0.6 per cent. Hong Kong's Hang Seng Index dropped 0.4 per cent. South Korea's Kospi Index advanced 1.7 per cent as sales at the nation's major department stores increased in July for a 17th month amid an economic recovery.

Profits for companies in the MSCI Asia Pacific are forecast to rise 26 per cent in the next 12 months. That compares with 27 per cent growth for the MSCI World Index of stocks in 24 developed nations, according to data compiled by Bloomberg.

Energy-related stocks posted the biggest gain among 10 industry group on the MSCI Pacific Index this week.