Asian stocks rose for the fourth week in five after better-than-estimated earnings and economic reports bolstered optimism the global economy is recovering. Li & Fung Ltd., the biggest supplier of clothes and toys to Wal-Mart Stores Inc., surged in Hong Kong after earnings beat analyst estimates. James Hardie Industries NV, the No. 1 seller of home siding in the U.S., jumped 15 percent in Sydney, after the Federal Reserve said the recession is easing and the nation’s unemployment rate dropped. Komatsu Ltd. and Hitachi Construction Machinery Co., Asia’s two largest makers of earthmoving equipment, rose in Tokyo following ratings upgrades. The MSCI Asia Pacific Index rose 3.2 percent to 114.23 this week, with about five stocks advancing for every three that fell. The gauge has climbed 62 percent from its March 9 five-year low on speculation the worst of the global recession has passed. Japan’s Nikkei 225 Stock Average and Australia’s S&P/ASX 200 Index both advanced for the fifth straight week. “With earnings and economic data coming in better than expected, there’s an element of panic buying going on,” said Prasad Patkar, who helps manage the equivalent of $1.2 billion at Platypus Asset Management in Sydney. “The market’s full of reluctant bulls praying for the market to pull back because they want to deploy cash at better levels.” Economic reports worldwide have driven stocks higher since March, lifting the average valuation of companies on the MSCI Asia Pacific Index to 25 times estimated profit as of yesterday, compared with 16.8 times for the Standard & Poor’s 500 Index ------------Chinese ‘correction’ In China, the Shanghai Composite Index sank 6.6 percent, its biggest weekly decline since February and the steepest drop among global benchmarks. Chinese shares entered a so-called correction on Aug. 12 amid concern a rally in equities had outpaced earnings prospects. A U.S. Labor Department report on Aug. 7 showed the joblessness rate dropped to 9.4 percent last month from June, the first decline since April 2008. In Australia, home-loan approvals rose in June for a record ninth month, the statistics bureau said this week, while the French and German economies unexpectedly returned to growth in the second quarter. Li & Fung surged 19 percent to HK$27.80, the leading advance in Hong Kong’s Hang Seng Index. First-half profit growth of 13 percent beat analysts’ estimates, mainly on cost cuts. Leighton Holdings Ltd., Australia’s biggest construction company, rose 11 percent to A$33.30 after forecasting higher annual earnings. (Source: Bloomberg)