HONG KONG (MarketWatch) — Most Asian stocks rose Thursday after U.S. President Barack Obama and House Speaker John Boehner expressed optimism about a deal to avert the “fiscal cliff,” sparking a solid rebound on Wall Street.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.39% rose 1%, South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -1.49% gained 1.2% and Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO -0.33% advanced 0.7%.
Taiwan’s Taiex gained 0.9%, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -1.09% snapped a three-day losing streak to finish 1% higher.
But mainland Chinese shares declined for a fourth straight session, however, dropping further toward their lowest level in nearly four years, with brokerages and commodity companies pacing the losses. The Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 -0.06% dropped 0.5%.
The broad gains came after Obama said he hoped to have a deal by Christmas to avoid the more than $600 billion of tax hikes and spending cuts kick in from January, which investors worry will drag the U.S. economy into a recession. Rep. Boehner also told reporters he was optimistic Republicans could forge an agreement with the White House. Read: U.S. stocks rally as politicians talk deal.
Investors wary of short-seller reports
Commodities trader Olam denies accusations made by research firm Muddy Waters that it runs the risk of failure.
Some strategists said investors should be wary about paying too much attention to this week’s headlines about the “cliff.”
Alan James at Barclays Capital said that “with substantive discussions between Congressional leaders and the president not expected to kick off until next week, we would not read much into the volatile headlines.”
Peter Lai, director at DBS Vickers, said “people are waiting for concrete measures to build confidence.”
Lai added that while stocks in Shanghai have fallen to levels that he believes are oversold, he was “not pessimistic.”
Over the past year, the Shanghai Composite has plunged 17.6%, which including a 3.2% decline so far this week. For more on Shanghai stocks, read: Good China data, untraded shares slam market.
Japanese exporters got a boost as the dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0197% reclaimed the ¥82 level. Hitachi Ltd. /zigman2/quotes/203839937/delayed JP:6501 -0.26% /zigman2/quotes/203416411/delayed HTHIF +2.28% rose 2.9%, and Advantest Corp. /zigman2/quotes/206869087/delayed JP:6857 -0.89% /zigman2/quotes/202479540/delayed ADTTF -9.55% added 3.4%.
Sharp Corp. /zigman2/quotes/203224600/delayed JP:6753 -0.54% /zigman2/quotes/207472799/delayed SHCAF +3.24% jumped 3.1% on a Dow Jones Newswires report it was in talks with U.S. companies about a capital injection. The firm is talking to Dell Inc. /zigman2/quotes/203822527/composite DELL -2.32% , Intel Corp. /zigman2/quotes/203649727/composite INTC -1.70% and Qualcomm Inc. /zigman2/quotes/206679220/composite QCOM -2.73% , people familiar with the discussions reportedly said. Read: Sharp holds talks with Dell, others for funding.
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Auto makers also advanced despite news that industry retail sales for October fell in Japan from the year-earlier month, breaking a string of modest increases since December.
Among the three top auto makers, all of which posted year-on-year declines, shares of Toyota Motor Corp. /zigman2/quotes/203803129/delayed JP:7203 +1.10% /zigman2/quotes/200537742/composite TM -0.05% rose 1.2%, Honda Motor Co. /zigman2/quotes/200490352/delayed JP:7267 -0.07% /zigman2/quotes/207173990/composite HMC -1.02% advanced 2% and Nissan Motor Co. /zigman2/quotes/207656007/delayed NSANY -0.50% /zigman2/quotes/208298710/delayed JP:7201 -0.06% climbed 2.5%.
Resource sector shares, which were hit hard Wednesday, when U.S. austerity concerns boosted the dollar and pressured metal prices, broadly rebounded during the session.
In Tokyo, steel maker JFE Holdings Ltd. /zigman2/quotes/204336633/delayed JP:5411 -0.18% /zigman2/quotes/203557603/delayed JFEEF -20.06% climbed 3.5% and Kobe Steel Ltd. /zigman2/quotes/207391157/delayed JP:5406 -1.54% soared 6.9%; in Sydney, uranium extractor Paladin Energy Ltd. /zigman2/quotes/203269866/delayed AU:PDN -5.38% /zigman2/quotes/202157125/delayed PALAF +7.69% rallied 5.4% and Murchison Metals Ltd. climbed 2.5%; and Angang Steel Co. /zigman2/quotes/209338869/delayed HK:347 -1.81% /zigman2/quotes/205396484/delayed ANGGF -7.78% rose 1.4% and Jiangxi Copper Co. /zigman2/quotes/201668148/delayed HK:358 -1.24% /zigman2/quotes/204256025/delayed JIXAY -2.94% advanced 0.6% in Hong Kong.
Anglo-Australian mining giant Rio Tinto Ltd. /zigman2/quotes/200083756/delayed AU:RIO -0.46% /zigman2/quotes/202627887/composite RIO +0.79% added 0.9% in Sydney after outlining cuts to capital expenditure, and offering guarded optimism over Chinese ore demand. Read: Rio Tinto targets over $7 billion in cuts, savings.
Shares of brokerages suffered heavy losses on mainland Chinese bourses, helping erase gains recorded earlier in the day. Reuters cited a Chinese media report as saying that there has been discussion by key industry players to cut broker commission fees.
Shares of Sinolink Securities Co. /zigman2/quotes/205648937/delayed CN:600109 -1.07% plunged by the day’s 10% limit, Haitong Securities Co. /zigman2/quotes/203443667/delayed CN:600837 -0.77% lost 5.9% and Citic Securities Co. /zigman2/quotes/210326178/delayed CN:600030 -0.94% fell 4.4% in Shanghai; in Shenzhen, Changjiang Securities Co. /zigman2/quotes/206947567/delayed CN:000783 +2.68% lost 8.6% and Hong Yuan Securities Co. tumbled 9.1%.