By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) — Most major Asian stock markets made solid gains Friday, as the region’s investors cheered signs of strength in the U.S. economy.
Among the best performers, Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK +0.23% ended 1.5% higher, while Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO +0.36% rallied to a closing gain of 1.8%.
In China, the Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 +1.10% shrugged off early weakness to trade 1.2% higher in the afternoon, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +1.07% was 0.5% higher in late moves.
However, South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.02% fell 0.6%, with losses for index heavyweight Samsung Electronics Co. /zigman2/quotes/209800866/delayed KR:005930 +1.82% /zigman2/quotes/202367843/delayed SSNLF 0.00% providing a drag.
Asia’s mostly higher performance came after U.S. stocks rose Thursday, with the S&P 500 index /zigman2/quotes/210599714/realtime SPX +0.91% coming very close to hitting a record high, just as the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +1.22% did last week.
An unexpected drop in jobless claims provided the trigger for U.S. gains, suggesting that the labor market is improving. Read: U.S. stock rally lifts S&P 500 to near record
“Without a doubt the biggest worry to investor positioning right now would be a reversal in the strong U.S. housing and consumer story. Happily, the latest U.S. retail sales data allay such fears,” Bank of America Merrill Lynch’s chief investment strategist Michael Hartnett said, referring to U.S. February retail data out Wednesday showing a strong improvement.
“We’ll remain long stocks — particularly global banks, Japan and Europe — in the absence of a damaging jump in rates or a decline in corporate earnings,” Hartnett said.
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“Investors who missed the doubling in value of U.S. stocks since early 2009 seem determined not to miss a similar move by the Japanese equity indices,” he said.
Hartnett said his bank’s Japanese equity strategist has just revised up his end-2013 Topix target to 1,250. The Topix — which tracks all large-capitalization stocks traded in Tokyo — closed at 1,051.65 Friday for a gain of 1.3%.
Japan’s stock gains Friday came as the government upgraded its assessment of the economy for the third straight month, citing improvements in industrial production and corporate profits. At the same time, the upper house of Japan’s parliament confirmed Haruhiko Kuroda — seen as dovish on monetary policy — as the new governor of the Bank of Japan.
Among Tokyo-listed winners Friday, TDK Corp. /zigman2/quotes/208948266/delayed JP:6762 +2.60% /zigman2/quotes/203182885/delayed TTDKF +5.63% rose 3.1%, Nikon Corp. /zigman2/quotes/203281219/delayed JP:7731 -0.34% /zigman2/quotes/203151879/delayed NINOF -3.07% climbed 2.5%, and Sony Corp. /zigman2/quotes/201361720/delayed JP:6758 -0.28% /zigman2/quotes/208567357/composite SNE +0.14% soared 11%, helped by a ratings upgrade from Daiwa Securities.
Globally exposed shipping companies were also strong, with Nippon Yusen K.K. /zigman2/quotes/203488100/delayed JP:9101 +0.31% /zigman2/quotes/201056741/delayed NYUKF -3.22% surging 6.4%, Mitsui O.S.K. Lines Ltd. /zigman2/quotes/204152844/delayed JP:9104 -0.14% /zigman2/quotes/210406910/delayed MSLOF 0.00% up 6%, and Kawasaki Kisen Kaisha Ltd. /zigman2/quotes/201857679/delayed JP:9107 +2.64% higher by 4.1%.
As for mainland China, the banking sector was among the sources of strength Friday, with China Minsheng Banking Corp. /zigman2/quotes/203910009/delayed CN:600016 +0.16% /zigman2/quotes/200749234/delayed CMAKY -2.80% up 4% in late trade, and China Citic Bank Corp. /zigman2/quotes/206411273/delayed CN:601998 0.00% /zigman2/quotes/204346887/delayed CHBJF +1.96% higher by 3.1%.
China’s securities regulator has proposed scrapping some requirements applying to domestic investors seeking outbound investment, the latest in a series of moves that could further open up the country’s capital account.
Kim Eng Securities head of sales trading Andrew Sullivan also cited China’s smooth transition of power — formally installing Xi Jinping as the new president Thursday, followed by Li Keqiang taking the post of premier Friday — which he said appears to have generated some optimism on reform.
“There’s positive sentiment that the new leadership has been rubber-stamped and now progress can start,” he said, adding that investors will be looking for clarity on policies going forward.
Meanwhile, Australian shares rebounded from losses made in the previous session, when strong jobs numbers prompted a scaling back of interest-rate-cut expectations.
Banks and consumer staples firms were in the lead in Sydney, with Commonwealth Bank of Australia /zigman2/quotes/200638713/delayed AU:CBA +0.47% /zigman2/quotes/207018701/delayed CBAUF -1.58% finishing higher by 1.9%, and Wesfarmers Ltd /zigman2/quotes/204567133/delayed AU:WES +0.02% advancing 2.5%.
Earnings gave Hong Kong a mild lift, with telecom giant China Mobile Ltd. /zigman2/quotes/200868736/delayed HK:941 0.00% /zigman2/quotes/204514293/composite CHL -0.26% up 0.5% to add to mild earnings-related gains made the day before — the telecom posted a modest 2.7% rise in annual profit and said it would make a massive investment in building out a 4G network.
Ping An Insurance Group Co. /zigman2/quotes/210315058/delayed HK:2318 +0.56% /zigman2/quotes/202212125/delayed PNGAY +0.22% rose 0.8%.after posting a 3% rise in fiscal-year profit, while fellow insurer AIA Group Ltd. /zigman2/quotes/203565558/delayed HK:1299 +0.52% /zigman2/quotes/205179901/delayed AAGIY +0.43% climbed a sharper 2.1%.
Banks also advanced in Hong Kong, with HSBC Holdings PLC /zigman2/quotes/202687335/delayed HK:5 +0.44% , up 2.1%, and Standard Chartered PLC /zigman2/quotes/202369078/delayed HK:2888 +0.29% , higher by 2.4%, extending gains made Thursday after news that they would hike mortgage rates in Hong Kong.
Over in Seoul, Samsung Electronics fell 2.2% after the firm unveiled its latest smartphone, the Galaxy S4, at an event in New York. Also Friday, Samsung announced the promotion of two division presidents to become the group’s co-chief executive.
South Korean auto stocks offered a bright spot, however, with Hyundai Motor Co. /zigman2/quotes/206684590/delayed KR:005380 +0.42% up 3.8%. and affiliate Kia Motors Corp. /zigman2/quotes/206019389/delayed KR:000270 +0.11% /zigman2/quotes/205439169/delayed KIMTF 0.00% higher by 2.6%.