Asian stocks rose, driving up a regional benchmark index by the most in two months, after companies reported higher earnings and U.S. manufacturing expanded, boosting confidence in a global economic recovery. Toyota Motor Corp., the world’s biggest carmaker, advanced 3.3 percent in Tokyo after saying U.S. sales rebounded. Mitsubishi Electric Corp., a maker of factory equipment and home appliances, surged 7.4 percent in Tokyo after profit exceeded analysts’ estimates. BHP Billiton Ltd., the world’s largest mining company, rose 2.4 percent in Sydney after metal prices climbed. Paladin Energy Ltd., a uranium miner, gained 5.8 percent after the company completed an acquisition. The U.S. economic recovery is “leading to better company earnings,” said Koichi Kurose, chief strategist in Tokyo at Resona Bank Ltd., which manages about $57 billion in assets. “Investors’ sentiment toward the global economy is good.” The MSCI Asia Pacific Index rose 1.3 percent to 139.25 as of 3:40 p.m. in Tokyo, the biggest percentage gain since Dec. 2 and erasing its loss for this year. About 5 times as many shares advanced as declined, and all 10 industry groups climbed. All benchmark equity indexes that were open for trading in the Asia-Pacific region rose. Japan’s Nikkei 225 Stock Average gained 1.8 percent and Australia’s S&P/ASX 200 Index increased 0.9 percent. Hong Kong’s Hang Seng index advanced 1.8 percent and Singapore’s Straits Times Index climbed 0.8 percent in half- day trading ahead of the Lunar New Year holiday. India’s Sensitive Index rose 1.2 percent, its first gain in five days. Stock markets in China, Hong Kong, South Korea and Singapore shut from today for the Lunar New Year, and exchanges in Taiwan and Vietnam have been closed all week. Manufacturing, Autos Futures on the Standard & Poor’s 500 Index were little changed today. The index gained 1.7 percent yesterday in New York, the most since Dec. 1, after American and Chinese manufacturing expanded and United Parcel Service Inc. beat analysts’ earnings estimates. The Institute for Supply Management’s factory index of the U.S. rose to 60.8, beating the median economist projection of 58, figures from the Tempe, Arizona-based group showed yesterday. Readings greater than 50 signal growth. Consumer-discretionary stocks and raw-material companies gained the most today among the 10 industry groups in the MSCI Asia Pacific Index. Toyota rose 3.3 percent to 3,480 yen, the biggest support to the MSCI index. The company reported a 17 percent increase in U.S. sales in January, leading gains for Asia-based automakers. Li & Fung Ltd., the largest supplier of clothes and toys to Wal- Mart Stores Inc. and Target Corp., gained 2.2 percent to HK$50.15 in Hong Kong. Earnings Improve Mitsubishi Electric jumped 7.4 percent to 996 yen, the second-biggest increase in the MSCI index. The company reported net income of 45.6 billion yen ($560 million) in the three months through December, compared with the average of 27.1 billion yen estimated by five analysts surveyed by Bloomberg. Among other Japanese companies that reported higher earnings or forecasts were Otsuka Corp., which makes computer- information software, NTT Data Corp., a network-services provider, and Casio Computer Co., a maker of cameras and mobile phones. All of them gained more than 6.6 percent. Otsuka’s 11 percent increase was the biggest in the MSCI index. About 220 of the 1,019 companies in the MSCI index are scheduled to release earnings statements this week. Of the 235 that have reported results for the latest quarter, 97 have exceeded analysts’ estimates, while 82 have missed them, according to data compiled by Bloomberg. ‘Steadily Recovering’ U.S. manufacturing and company earnings “are steadily recovering,” said Hiroichi Nishi, an equities manager in Tokyo at Nikko Cordial Securities Inc. “Japanese companies are in good shape. Many of them had nine-month earnings exceeding 75 percent of their annual profits.” The MSCI Asia Pacific Index fell 0.2 percent this year to yesterday, compared with gains of 4 percent for the S&P Index and 3 percent for the Stoxx Europe 600 Index. The Asian gauge sank 0.7 percent on Jan. 31, its biggest drop in a week, amid demonstrations against Egypt’s government and as some earnings reports disappointed investors. That pushed the average price of stocks in the index to below 14 times estimated earnings on average, its lowest level since September. Commodities Advance BHP advanced 2.4 percent to A$45.70 in Sydney, the second- biggest boost to the MSCI index. Rio Tinto Group, the world’s No. 3 mining company, increased 2 percent to A$85.82. Mitsui & Co., a trading company that counts commodities as its largest source of profit, rose 3.9 percent to 1,449 yen in Tokyo. Jiangxi Copper Co., China’s No. 1 maker of the metal, climbed 3.4 percent to HK$25.75 in Hong Kong. The London Metal Exchange Index of six metals including copper and aluminum advanced 1.8 percent yesterday, rising for a fifth day to the highest level since March 2008. Gold futures for April delivery climbed 0.4 percent to settle at $1,340.30 in New York yesterday. Copper advanced to a record on signs demand will remain robust in China, the world’s biggest consumer of the metal used in cars, homes and appliances. Aluminum and nickel climbed to two-year highs. Paladin Energy jumped 5.8 percent to A$5.44 in Sydney after the company said it completed the purchase of Aurora Energy Resources Inc.’s uranium assets. Genting Bhd., a Malaysian casino, power and plantation group, advanced 6.4 percent to 11.34 ringgit in Kuala Lumpur. The company said its Resorts World Sentosa Ltd. unit borrowed S$4.2 billion ($3.3 billion) to refinance debt. To contact the reporters on this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net. To contact the editor responsible for this story: Nicolas Johnson at nicojohnson@bloomberg.net.

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