Asian Stocks Advance on China Manufacturing, Commodity Prices

June 1 (Bloomberg) -- Asian stocks rose, extending the longest monthly winning streak since the financial crisis began in 2007, as an expansion in Chinese manufacturing for a third month drove commodity prices higher.

Mitsubishi Corp., a trading house that gets more than half of its profit from commodities, jumped 5.6 percent in Tokyo. Cnooc Ltd., China’s largest offshore oil producer, gained 4.7 percent as oil climbed to a seven-month high. BOC Hong Kong (Holdings) Ltd., a Bank of China Ltd. unit, surged 7.3 percent after Deutsche Bank AG recommended investors buy the stock.

“China has been the only beacon in the intense global economic storm we’ve found ourselves in,” said Prasad Patkar, who helps manage about $1 billion at Platypus Asset Management in Sydney. “Continuing strength in China’s economy bodes very well for the Asian region generally.”

The MSCI Asia Pacific Index advanced 1.5 percent to 103.57 at 12:01 p.m. in Tokyo. The gauge has surged 47 percent since falling to a more than five-year low on March 9 on speculation the worst of the financial crisis has passed.

The Nikkei 225 Stock Average rose 0.8 percent. Australia’s S&P/ASX 200 Index gained 1.3 percent as the government said retail sales rose for a second month. China’s Shanghai Composite Index jumped 2.3 percent after the Federation of Logistics and Purchasing reported a reading of 53.1 for its Purchasing Manager’s Index in May. A result above 50 indicates an expansion.

Sino Land Co. added 1.8 percent in Hong Kong, leading gains among the city’s real-estate developers, after saying it will increase prices at one of its projects. Kawasaki Kisen Kaisha Ltd., Japan’s third-largest shipping line by sales, jumped 7.7 percent as shipping rates climbed for a 20th day.

Oil, Copper Prices

Futures on the Standard & Poor’s 500 Index gained 0.5 percent, erasing an earlier 0.2 percent drop. The gauge climbed 1.4 percent in New York on May 29, capping a three-month rally for the index, as commodities climbed on optimism an economic recovery will boost demand for fuel, metals and crops.

Crude oil futures in New York climbed as much as 1 percent $66.95 a barrel in after-hours trading, the highest since Nov. 5. The price advanced 30 percent in May, the biggest monthly increase since March 1999. Copper prices rose 2.8 percent on May 29, capping a 7.3 percent gain in May.

Mitsubishi gained 5.6 percent to 1,900 yen in Tokyo. Its closest rival Mitsui & Co. climbed 4.6 percent to 1,272. BHP Billiton Ltd., the world’s largest mining company, added 2.6 percent to A$35.57 in Sydney.

Cnooc climbed 4.7 percent to HK$10.68. Jiangxi Copper Co., China’s largest producer of the metal, surged 8.4 percent to 30.90 yuan in Shanghai.

Stimulus Package

Loan growth, accelerating fixed-asset investment and rising retail sales in China have spurred confidence that Premier Wen Jiabao’s 4 trillion yuan ($586 billion) stimulus package is working. In Japan, the government last week raised its assessment of the economy for the first time in three years.

Optimism that government spending and interest-rate cuts will support a global economic recovery has helped drive the global stock rally since March. The average valuation of companies on MSCI’s Asian index climbed to 1.4 times the book value of assets on May 29, an increase of 17 percent from the end of 2008.

The MSCI gauge climbed 12 percent in May, its third monthly advance, and the longest winning streak since Bear Stearns Cos. filed for bankruptcy protection in July 2007 for two hedge funds.

BOC Hong Kong surged 7.3 percent to HK$13.24. Deutsche Bank raised its recommendation on the stock to “buy” from “hold,” saying it was the top pick among Hong Kong banks amid an increase in return on equity.

Baltic Dry

Sino Land rose 1.8 percent to HK$14.64. The company said it will lift prices at its Lake Silver development by as much as 5 percent after selling more than 1,600 apartments since May 27.

Kawasaki Kisen, Japan’s third-largest shipping line by sales, advanced 7.7 percent to 464 yen in Tokyo. STX Pan Ocean Ltd., South Korea’s biggest bulk carrier, added 3.8 percent to 13,700 won. China Cosco Holdings Co., the world’s largest operator of dry-bulk ships, rose 5.3 percent to HK$11.16.

The Baltic Dry Index, which measures the cost of shipping commodities, rose 5.9 percent in London on May 29, its 20th day of gains. The gauge climbed 96 percent in May, its biggest monthly advance on record.