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Asian stocks entered a bull market yesterday after central-bank easing from the U.S. and Europe to China and Japan fueled the fastest rally in more than two years.

China Shipping Container Lines Co. (2866), which surged 163 percent, led gains since a low on Oct. 5 as efforts to prevent the spread of Europe’s debt crisis and improving U.S. economic reports boosted the outlook for the region’s exporters. S-Oil Corp. (010950), Korea’s No. 3 refiner, led energy stocks higher as crude prices surged. Agile Property Holdings Ltd. (3383), a Chinese developer, rose 137 percent on speculation the country will ease property curbs as inflation slows.

Esprit Holdings Ltd., a Hong Kong-listed clothier that gets about 80 percent of revenue from Europe, climbed 85 percent to HK$17.40. Photographer: Jerome Favre/Bloomberg
.The MSCI Asia Pacific Index was little changed at 128.95 as of 10:21 a.m. today in Tokyo, after advancing more than 20 percent from its Oct. 5 low and entering a so-called bull market as of yesterday. The gauge has advanced the last 10 weeks, the longest such streak since its inception in 1988, as the European Central Bank expanded its balance sheet to a record, the U.S. Federal Reserve pledged near-zero interest rates and China lowered reserve ratios.

“One would have expected some kind of a pause by now because the market has been rising since mid-December,” said Mark Matthews, Singapore-based head of research for Asia at Julius Baer, which oversees about $180 billion in assets under management globally. “The major thing that put the floor on markets was the European Central Bank’s long-term refinancing operations that were introduced in December. U.S. data has been pretty robust too. All these things are good. It’s all good.”

The rally has boosted valuations for Asian stocks to the highest level in two years relative to global equities. The MSCI Asia Pacific Index (MXAP) trades at 15.1 times estimated profit, while the MSCI All-Country World Index has a multiple of 12.7, according to data compiled by Bloomberg.

Regional Gauges Surge
The Hang Seng China Enterprises Index (HSCEI), which added 46 percent from Oct. 5, has led gains as easing inflation and slowing growth in the world’s second-largest economy allowed the People’s Bank of China to cut reserve requirements twice.

Chinese property companies and infrastructure stocks such as CSR Corp., a railcar maker whose Hong Kong shares jumped 151 percent, have surged as HSBC Holdings Plc, JPMorgan Chase & Co. and Goldman Sachs Group Inc. said the government has a number of tools to fine tune the economy. Hong Kong’s Hang Seng Index advanced 33 percent in the period.

Japan’s Nikkei 225 Stock Average (NKY) climbed 15 percent. Gains increased through February as further easing by the Bank of Japan and receding concern about financial meltdown in Europe saw the yen weaken, boosting the outlook for the nation’s exporters.

Easing Lends Strength
“The global trend towards monetary easing is the major factor giving equities strength,” Ayako Sera, a market strategist in Tokyo at Sumitomo Trust & Banking Co., which manages the equivalent of $298 billion. “Corporate earnings are holding up even amid some concern about the global economy, and easing measures are pushing up shares.”

Analysts are estimating that Asia-Pacific index companies will record earnings-per-share growth of 31 percent over the next four quarters, according to data compiled by Bloomberg. About half of companies that have issued quarterly reports since Jan. 9 have failed to meet analysts’ estimates.

Australia’s S&P/ASX 200 Index gained 9.5 percent. Korea’s Kospi Index increased 22 percent. The BSE India Sensitive Index advanced 12 percent.

“The rally looks sustainable,” said Khiem Do, Hong Kong- based head of multi-asset strategy at Baring Asset Management Ltd., which oversees $46 billion. “The recession in Europe doesn’t look that severe. The U.S. economy looks OK and China isn’t falling into a hard landing.”

China’s Manufacturing
China’s manufacturing improved for a third straight month in February, signaling the world’s second-biggest economy is maintaining momentum amid Europe’s debt crisis and a cooling domestic property market.

Energy companies had the biggest advance among the 10 industries in the Asia-Pacific gauge as the improving economic outlook and simmering tensions with Iran spurred an increase of more than 40 percent in the price of oil since October.

South Korean S-Oil jumped 52 percent to 125,500 won in the period. Japan Petroleum Exploration Co. (1662) increased 47 percent to 3,945 yen and Santos Ltd. (STO), Australia’s No. 2 oil company, climbed 27 percent. Sembcorp Marine Ltd., the world’s No. 2 maker of oil rigs, jumped 72 percent to S$5.35 in Singapore.

ECB President Mario Draghi’s unprecedented emergency lending to euro-region financial institutions helped persuade investors that a credit freeze will be averted. The ECB said yesterday it will lend banks 529.5 billion euros ($712.2 billion) for 1,092 days, topping the 489 billion euros handed out to 523 institutions in the first three-year operation in December.

Exporters Advance
Esprit Holdings Ltd. (330), a Hong Kong-listed clothier that gets about 80 percent of revenue from Europe, climbed 85 percent to HK$17.40. Hutchison Whampoa Ltd., owner of ports in Germany, Spain and Italy, advanced 43 percent. Canon Inc., the Japanese camera maker that counts Europe as its biggest market, added 7.3 percent to 3,680 yen.

Exporters to the U.S. have also risen amid promises from the Federal Reserve to keep borrowing rates near zero through at least late 2014 to support growth. Applications for U.S. unemployment insurance benefits were unchanged in the week ended Feb. 18 at 351,000, the fewest since March 2008, Labor Department figures showed Feb. 23. Measures of consumer confidence and housing starts have also improved.

Li & Fung Ltd. (494), the biggest supplier to Wal-Mart Stores Inc., jumped 54 percent to HK$17.80. James Hardie Industries NV (JHX), which makes most of its revenue selling home siding in the U.S., surged 36 percent to A$7.33 in Sydney. Samsung Electronics Ltd., the world’s second-largest seller of phone handsets, climbed 43 percent in Seoul.

Among stocks that fell, Elpida Memory Inc. (6665), the Japanese computer-memory maker, had the biggest decline, dropping 99 percent to 7 yen after filing for bankruptcy on Feb. 27. Hynix Semiconductor Inc., a Korean rival, has increased 51 percent since Oct. 5.