Asia Rallies on IMF Upgrade of Japan Along With Better Than Expected Japanese Exports

“Asian stocks advanced for the first time in three days as new-home construction in the U.S. jumped more than forecast, the International Monetary Fund raised its forecast for Japanese growth and the yen weakened

Toyota Motor Corp., the world’s largest carmaker, advanced 1.8 percent as a weakening yen boosted the earnings outlook for exporters. Advantest Corp. paced increases in Tokyo among makers of semiconductor equipment after Intel Corp. (INTC) forecast second- quarter sales that would exceed some analysts’ estimates. Cathay Pacific Airways Ltd., Asia’s biggest international carrier by passenger revenue, climbed 2.9 percent in Hong Kong after Deutsche Bank AG raised its rating to buy.

The MSCI Asia Pacific Index gained 0.6 percent to 137.21 as of 6:08 p.m. in Tokyo. Three shares advanced for every two that fell, with eight of the 10 industry groups on the gauge climbing. The benchmark rose 5.5 percent this year through yesterday amid signs the U.S. economy is recovering and as Japanese stocks rallied on speculation the Bank of Japan will boost stimulus.

“U.S. housing starts showed a bright spot and confirmed the view that the economy is on the mend,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc. “The yen will stay in a downtrend given the bold monetary easing by the Bank of Japan, and that leads to optimism exporters’ earnings will outperform.”

Plans for fiscal stimulus and record monetary-policy easing by the Bank of Japan were reflected in the IMF’s increased growth estimates for the world’s third-biggest economy, which were raised to 1.6 percent this year from 1.2 percent and to 1.4 percent in 2014 from 0.7 percent. IMF Chief Economist Olivier Blanchard said the BOJ’s action was “appropriate” and its impact on the yen “a logical consequence.”

Exporters Rise

Japanese exporters rallied. Toyota Motor gained 1.8 percent to 5,550 yen, Nissan Motor Co. advanced 3.3 percent to 1,024 yen and Ricoh Co., an imaging equipment maker that gets more than half of sales outside Japan, added 3.8 percent to 1,197 yen. The yen fell to 98.34 per dollar….”

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