HONG KONG (MarketWatch) — Japanese stocks ended at eight-month highs to lead Asian markets Thursday on the yen’s extended weakness, while South Korean and Taiwanese shares made strong advances after the U.S. Federal Reserve added more monetary stimulus.
Hong Kong and Australian shares slipped from 16-month highs on mild profit-taking pressure, and mainland Chinese equities slid lower, paced by weakness in the resource sector.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.69% surged 1.7% after closing at its highest level since early April, South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.06% rose 1.4% and Taiwan’s Taiex added 0.9%.
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“Sentiment has been boosted by the Fed’s confirmation of outright purchase of long-dated Treasurys, which translates into a bigger asset-purchase program,” said Frances Cheung, a strategist at Crédit Agricole. “Flows into Asian markets are likely to continue.”
Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO -0.07% ending marginally lower, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.52% fell 0.3% after recent gains that pushed both benchmarks to their highest levels in 16 months.
The Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 +2.26% fell 1%, paring its month-to-date advance to 4.1%.
The mixed-to-better performance in Asia echoed U.S. trading overnight, when the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.09% and S&P 500 /zigman2/quotes/210599714/realtime SPX +0.18% ended almost flat after the Fed monetary policy decision. The Fed announced a plan to expand its asset-buying program, and to hold rates close to zero until unemployment falls below 6.5% or until inflation accelerates. Read: Fed sets jobless, inflation targets; to buy bonds.
Japanese stocks stood out as the dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.1531% shot above the ¥83 mark overnight for the first time since April 2.
While the move partly stemmed from the Federal Reserve’s announcements and a steeper Treasury curve, BNP Paribas currency strategists said “markets remain clearly focused on the Bank of Japan’s policy” ahead of Japanese leadership elections this weekend, and a central-bank decision next week.
Speculation that leadership change in Sunday’s election would lead to pressure on the Bank of Japan to expand its already loose monetary policy has pressured the yen and boosted currency-sensitive companies in recent weeks.
Many Tokyo-listed exporters added to gains on Thursday, with Sharp Corp. /zigman2/quotes/203224600/delayed JP:6753 -2.81% /zigman2/quotes/207472799/delayed SHCAF +3.24% soaring 6.4%, Panasonic Corp. /zigman2/quotes/201785256/delayed JP:6752 -0.99% climbing 7.9% and Sony Corp. /zigman2/quotes/201361720/delayed JP:6758 -2.23% /zigman2/quotes/208567357/composite SNE -1.11% rising 6.4%.
/zigman2/quotes/210597971/delayed NIK 23,523.24, -164.35, -0.69%
Stan Shamu, market strategist at IG Markets, said that the dollar may make further gains against the yen in the near future.
Power companies weighed in Hong Kong, with CLP Holdings Ltd. /zigman2/quotes/204954538/delayed HK:2 0.00% /zigman2/quotes/209588494/delayed CLPHY +0.28% dropping 3.6% on reports it plans to raise about $984 million via a share placement. Read: CLP Holdings raises $982 million from share sale.
Resource stocks were broadly lower in Shanghai trading as gold prices skidded and crude-oil declined after posting gains Wednesday.
Shares of Shandong Gold-Mining Co. /zigman2/quotes/200150484/delayed CN:600547 +1.62% slid 3.7% and Zhongjin Gold Corp. /zigman2/quotes/207741711/delayed CN:600489 +1.50% lost 3%, while PetroChina Co. /zigman2/quotes/205108732/composite PTR -0.27% /zigman2/quotes/206980083/delayed CN:601857 +1.89% fell 0.6%.
Gold miners also lost ground elsewhere, with Newcrest Mining Ltd. /zigman2/quotes/203840223/delayed AU:NCM -0.75% /zigman2/quotes/203286036/delayed NCMGY -2.11% down 0.8% in Sydney and Zhaojin Mining Industry Co. /zigman2/quotes/203361399/delayed HK:1818 -0.12% /zigman2/quotes/200275285/delayed ZHAOF +0.77% losing 2.5% in Hong Kong.
In Seoul, heavyweight Samsung Electronics Co. /zigman2/quotes/209800866/delayed KR:005930 -0.49% /zigman2/quotes/202367843/delayed SSNLF 0.00% extended its recent all-time highs to add 2.9% on the back of the Fed’s policy decisions.
Shares of STX Corp. /zigman2/quotes/200300669/delayed KR:011810 -0.13% fell 0.8% following a Dow Jones Newswires report the conglomerate was in talks with multiple investors to sell its 27.4% stake in STX Pan Ocean Co. /zigman2/quotes/205341939/delayed KR:028670 -0.25% .
STX Pan Ocean rose 6.7% to extend week-to-date gains to just under 40%.