Japanese stocks rebounded after yesterday's slide, following reports that Japan's pension fund may boost stock holdings and that the nation's industrial output expanded faster than estimated last month. The Nikkei rose as high as 2 per cent before flagging later on Friday. The MSCI Asia Pacific was 0.6 per cent higher. Japanese deflation eased slightly, and industrial production rose 1.7% in April; the latter exceeding median forecasts of a Bloomberg survey which pointed to an 0.6% gain. Core consumer prices, which include oil but exclude volatile costs for fresh food, fell 0.4% from a year earlier, matching the Reuters median market forecast and coming in below the Bloomberg consensus of 0.7%. The sixth straight fall was slightly narrower than the 0.5% decline in March. Household spending for April missed expectations, coming in at 1.5% growth year-on-year, compared to expectations of 3.1%, and a 5.2% rise in March. Consumer products giants turn screws on ad agencies, suppliers: "Some of the world's largest consumer products groups are delaying payments to advertising agencies and commodity producers for up to six months, squeezing cash flows and causing alarm at critical points in their supply chains." Mondelez International, Procter & Gamble, Johnson & Johnson and Anheuser-Busch InBev have all recently extended their payment terms. Sony hires banks for Loeb plan: "Sony is working with Morgan Stanley and Citigroup as it considers adopting billionaire Daniel Loeb's proposal for an initial public offering of its entertainment unit, said people familiar with the matter." Smiths Group is again weighing a potential £2bn-plus sale of its medical division, which played a role in the first successful IVF treatment, three years after a failed private equity approach for the business. UBS is raising salaries for investment bankers to catch up with rivals, said three people with knowledge of the plan, while it continues with a plan to cut staff numbers by 10,000. HTC has scrapped plans to introduce a full-sized tablet computer with Microsoft's Windows RT operating system on concern it will meet with lackluster demand, according to people familiar with the matter. Procter & Gamble is already thinking about succession, with four senior executives planned to be elevated to new roles. Former chief exeuctive AG Lafley, who came out of retirement last week to place his hand-picked successor Robert McDonald, isn't expected to stay for more than two or three years and lining up possible replacements is one of of his top priorities, people close to the company said. Encore breaks into UK debt market: US debt management and recovery firm Encore Capital Group has agreed to buy a majority stake in Cabot Credit Management (CCM) for £128m, to tap into the UK's debt purchase market. The deal comes weeks after New York buyout house JC Flowers acquired Cabot in an agreement worth an estimated £500m. Boeing won the first order for the stretched version of its 787 Dreamliner as Singapore Airlines split a purchase of jets with Airbus SAS valued at $17bn. Japan equities retreat raises the stakes for Abenomics. Interview: New Vatican bank head, Ernst von Freyberg. Lombard: Twists in RBS tale may never end. Eurozone bailouts, the IMF and the OSI. The debate over US Treasuries falling. Asia's growth drives numbers of super rich. Asian markets Nikkei 225 up +137.47 (+1.01%) at 13,726 Topix up +3.28 (+0.29%) at 1,137 Hang Seng down -28.61 (-0.13%) at 22,583 US markets S&P 500 up +6.05 (+0.37%) at 1,654 DJIA up +21.73 (+0.14%) at 15,325 Nasdaq up +23.78 (+0.69%) at 3,491 European markets Eurofirst 300 up +3.91 (+0.32%) at 1,227 FTSE100 up +29.82 (+0.45%) at 6,657 CAC 40 up +22.19 (+0.56%) at 3,996 Dax up +63.62 (+0.76%) at 8,400 Currencies €/$ 1.30 (1.30) $/¥ 101.08 (100.72) £/$ 1.52 (1.52) Commodities ($) Brent Crude (ICE) down -0.06 at 102.13 Light Crude (Nymex) down -0.07 at 93.54 100 Oz Gold (Comex) up +8.80 at 1,420 Copper (Comex) unchanged 0.00 at 3.31 10-year government bond yields (%) US 2.11% UK 1.98% Germany 1.51% CDS (closing levels) Markit iTraxx SovX Western Europe +1.26bps at 83.31bp Markit iTraxx Europe +0.14bps at 100.32bp Markit iTraxx Xover +0.29bps at 410.91bp Markit CDX IG -0.76bps at 76.25bp