Asia Stocks, Commodities Snap Declines; Won Gains on Goldman

July 5 (Bloomberg) -- Asian stocks snapped four days of decline while commodities and the won gained on optimism the region will continue to grow even as there are mounting concerns about the pace of the global recovery.

The MSCI Asia Pacific Index gained 0.2 percent to 111.90 as of 11:30 a.m. in Tokyo. Oil increased for the first time in six days and copper advanced in London for a second day. Futures on the Standard & Poor’s 500 Index rose 0.3 percent. The U.S. benchmark declined 0.5 percent on Friday.

Investor optimism rose as valuations became more compelling following the MSCI Asia Pacific Index’s 13 percent decline since this year’s April 15 peak and after Premier Wen Jiabao said China will ensure “steady and relatively fast” growth. Gains were muted by the 125,000 decline in U.S. payrolls last month and after European Central Bank President Jean-Claude Trichet pressed governments to trim their budget deficits, saying this was needed to boost confidence.

“The outlook for growth around the world is certainly not as optimistic as it was a few months ago,” said Toby Hassall, a commodity analyst at CWA Global Markets Pty in Sydney. “There will be the longer-term participants in the market who are viewing this decline in price as a good time to get long.”

Japan’s Nikkei 225 Stock Average rose 0.4 percent as the weaker yen boosted Japanese companies’ revenue from overseas when they are repatriated. The Shanghai Composite Index retreated 0.7 percent.

Centennial Takeover

Centennial Coal Co. surged 33 percent in Sydney after Banpu Pcl agreed to buy the 80 percent of Centennial it doesn’t already own. CSR Ltd., Australia’s No. 2 building-products maker, climbed 3.2 percent after agreeing to sell its Sucrogen sugar unit to Wilmar International Ltd. for A$1.75 billion ($1.5 billion). Canon Inc., the world’s biggest maker of cameras, gained 0.9 percent in Tokyo as the yen weakened against the euro.

China Cosco Holdings Co., the nation’s biggest shipping company by market value, fell 1.3 percent as the Baltic Dry Index, a measure of commodity-shipping costs, extended the longest losing streak since August 2005.

Crude oil rose 0.8 percent to $72.69 a barrel in New York, recovering from its biggest weekly decline in eight. Three-month delivery copper climbed as much as 1.6 percent to $6,510 a metric ton on the London Metal Exchange.

Goldman Boosts Won

South Korea’s won strengthened for the first time in five days after Goldman Sachs Group Inc. raised its 2010 economic growth forecast. The won led gains among regional currencies, having last week recorded the biggest loss as purchasing managers’ surveys showed manufacturing growth was slowing in the U.S., Europe and China.

The won strengthened 0.6 percent to 1,221.60 per dollar in Seoul, after sliding 1.1 percent last week, according to data compiled by Bloomberg.

The Bank of Korea will keep its benchmark interest rate at a record-low 2 percent at a review this week, according to seven of 10 economists surveyed by Bloomberg. Three predicted a quarter of a percentage point increase.

“Offshore players are selling dollars more than expected,” said Ha Jun Woo, a currency trader for Daegu Bank Ltd. in Seoul. “We’re also seeing preemptive bets ahead of the central bank’s monetary policy meeting. If interest rates rise, that will push investors to sell dollars and buy the won.”

Euro Weakens

The euro declined from near its strongest level in six weeks amid speculation the sovereign debt crisis in Europe will force the region’s central bank to keep interest rates at a record low.

The euro fell 0.2 percent to $1.2542 in Tokyo, from $1.2566 on July 2, when it reached $1.2612, the most since May 21. The yen traded at 87.91 per dollar from 87.75 last week in New York, after climbing to 86.97 on July 1, the strongest since Dec. 2. It bought 110.13 per euro from 110.27.

“The ECB will be forced into a lower-for-longer stance on its monetary policy,” said Sue Trinh, a senior currency strategist in Hong Kong at Royal Bank of Canada. “We are still very bearish on the euro and expect a move toward $1.15 by the end of the year.”