Asian stocks higher with the exception of China

Asian stocks were mostly higher with the exception of China which was soft again today. The MSCI Asia Pacific index was 0.6% higher in early afternoon Tokyo trading. The regional index is up around 17% since its two year lows reached in October last year. An additional 3% would technically see it in bull market territory but corporate earnings need to continue rising for that to be solidified. S&P500 index futures were last pointing to a flat open tonight. In Europe. Greek Prime Minister Lucas Papademos will meet with lawmakers to discuss debt negotiation terms.

The Australian dollar was last buying 1.0791 US cents while the euro consolidated recent gains, last trading at 1.3245 against the dollar. The US dollar gained against the yen where it last bought 77.04. Copper was slightly higher at US$3.87/lb while gold also consolidate its gains, after falling late yesterday afternoon, last trading at US$1745/oz.

Regional corporate news was dominated by the world’s largest miner – BHP Biliton – reporting its interim results. The good news is BHP has delivered a solid result in light of difficult market circumstances. The bad news, for some, is that the US$9.9bn after tax earnings number is below market expectations of around US$10.5bn. Its worth noting market expectations were hosed down over the past few months. Iron ore and petroleum which combined generate around 75% of total group earnings. Iron ore alone now represents just over 50% of total group underlying earnings.

BHP’s net debt has grown from US$5.8bn to US$21.5bn since June last year. This represents a debt/equity – also called gearing – ratio of around 33% which is manageable but might limit future capital management – buyback – capabilities. Shares were down slightly for most of the day in Sydney. In other regional corporate news, Toyota Motors – the largest regional carmaker – climbed more than 4% after raising its earnings forecasts for the year ending March 31. Toyota said third quarter net income fell by only 14% with revenue rising 4.1%.

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