Asian Stocks Climb as U.S. Automaker Speculation Boosts Honda

April 1 (Bloomberg) -- Asian stocks gained, led by automakers and commodity producers, on speculation the U.S. will let General Motors Corp. and Chrysler LLC fail, and after raw- material prices rose.

Honda Motor Co., which generates more than half its sales in North America, climbed 6.9 percent and South Korea’s Hyundai Motor Co. added 5.2 percent on optimism they will boost U.S. market share. The U.S. government is prepared to let Chrysler go bankrupt and be sold off piecemeal, while General Motors appears headed for a prepackaged bankruptcy, people familiar with the matter said. Santos Ltd., Australia’s No. 3 oil and gas producer, rose 2.8 percent after oil prices climbed.

The MSCI Asia Pacific Index gained 1.8 percent to 82.41 as of 10:52 a.m. in Tokyo, following a two-day, 5.3 percent slump. The gauge rose 7.6 percent last month, its first advance in 2009, as some investors bet governments worldwide will succeed in easing the financial crisis and reviving global growth.

“I would say we are cautiously optimistic about the outlook of the economy going forward,” said Diane Lin, a Sydney-based fund manager at Pengana Capital, which oversees about $1.9 billion. “Globally, the Japanese auto industry is the most competitive, and because of concern about the outlook and about the U.S., these companies are trading on very attractive valuations.”

Japan’s Nikkei 225 Stock Average rose 2.4 percent to 8,301.50. South Korea’s Kospi Index climbed 2.6 percent. Australia’s key index was little changed, with gains limited as the nation’s manufacturing slumped for a 10th consecutive month. OneSteel Ltd., Australia’s No. 2 steelmaker, slumped 7.1 percent after extending production cuts.

Automaker Bankruptcies

Futures on the Standard & Poor’s 500 Index slumped 1 percent, following the gauge’s 1.3 percent rally yesterday. Futures accelerated declines as news of the U.S. government’s plans for the automakers emerged.

U.S. President Barack Obama will let Chrysler go bankrupt and be sold off piecemeal if the third-largest U.S. automaker can’t form an alliance with Fiat SpA, said members of Congress who have been briefed on the subject and two other people familiar with the administration’s deliberations. A prepackaged bankruptcy for GM appears to be inevitable, the people said.

U.S. March auto sales data due later today are expected to come in at an annualized rate of 8.8 million vehicles, which would be the lowest since December 1981, according to economists in a Bloomberg News survey.

The MSCI Asia Pacific Index’s March rally pared its decline last quarter to 9.7 percent amid growing signs the global recession is hurting corporate earnings.

Tankan Survey

The Bank of Japan’s quarterly Tankan survey of sentiment among large manufacturers that was released today fell to minus 58, a record low and worse than economists had predicted.

Capital spending plans only dropped by half as much as economists had forecast and managers said they expect a rebound in profits starting in the second half of the financial year that begins today.

Japanese Prime Minister Taro Aso said yesterday his administration will compile a third stimulus package by mid- April to address the “economic crisis.”

Crude oil for May delivery rose 2.6 percent to $49.66 a barrel in New York yesterday, capping an 11 percent gain over three months. A measure of six primary metals traded in London advanced 2.1 percent.