By V. Phani Kumar, MarketWatch , Colin Ng and Wei-Zhe Tan
HONG KONG (MarketWatch) — Asian stocks ended mostly higher in holiday-thinned trade Wednesday, with Hong Kong and Shanghai markets rebounding as investors looked past China’s rate increase Saturday to snap up banks and commodity shares.
Miners held Australian shares back as the market reopened for the first time after Beijing’s rate increase, though Tower Australia rocketed higher on a takeover bid from Dai-ichi Life Insurance Co.
Snowstorm Hits Northwestern China
Heavy snow wreaks havoc in northwestern China, burying livestock and blocking roads. Video courtesy of Reuters.
Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +1.07% ended a three-trading-day losing streak by bouncing 1.5%. China’s Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP +0.43% , which declined in nine of the previous 10 sessions, advanced 0.7%.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK +0.23% rose 0.5%, Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +0.36% ended little changed, South Korea’s Kospi rose 0.5% and India’s Sensex was up 0.9% in afternoon trade.
Linus Yip, strategist at First Shanghai Securities, said that while markets in the U.S. and some parts of Asia hovered around two-year highs, Hong Kong and Shanghai stocks were lagging behind, setting the stage for a likely upsurge early in 2011. “The People’s Bank of China rate hike has cleared the uncertainty in the short term,” he said.
Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.10% futures were up 15 points in screen trade, pointing to a higher opening on Wall Street, where the benchmark finished at a 28-month high Tuesday.
Energy shares rose as crude-oil prices stayed above $91 a barrel and close to a two-year high.
Cnooc /zigman2/quotes/204964401/composite CEO -0.97% /zigman2/quotes/203421416/delayed HK:883 0.00% climbed 2.6% and PetroChina Co. /zigman2/quotes/204979431/delayed HK:857 +0.56% /zigman2/quotes/205108732/composite PTR -0.87% added 2.3% in Hong Kong, while Japan Petroleum Exploration Co. /zigman2/quotes/201212147/delayed JP:1662 -1.15% /zigman2/quotes/202925532/delayed JPTXF -1.12% advanced 2% in Tokyo and Cairn India was up 0.4% in Mumbai trade.
February Nymex crude-oil futures were 9 cents lower at $91.40 a barrel on Globex compared with Tuesday’s New York close.
The region’s gold miners also got a lift from firmer prices, which climbed above $1,400 per troy ounce Tuesday and stayed there Wednesday in Asia.
Zijin Mining Group Co. /zigman2/quotes/204517000/delayed HK:2899 -0.66% /zigman2/quotes/209836076/delayed ZIJMF -5.00% rose 2.2% in Hong Kong, with Zijin /zigman2/quotes/203833875/delayed CN:601899 -0.54% rising 0.6% and Zhongjin Gold Corp. /zigman2/quotes/207741711/delayed CN:600489 -0.12% adding 1.9% in Shanghai, while Newcrest Mining /zigman2/quotes/203286036/delayed NCMGY -2.22% /zigman2/quotes/203840223/delayed AU:NCM +0.96% added 2.5% in Sydney.
Spot gold was at $1,406.80, up 60 cents from its New York close.
In Sydney, mining stocks were pressured as the markets reopened for the first time since the PBoC rate increase Saturday, with Rio Tinto /zigman2/quotes/202627887/composite RIO -0.46% /zigman2/quotes/200083756/delayed AU:RIO 0.00% dropping 1% and BHP Billiton /zigman2/quotes/208108397/composite BHP -0.66% /zigman2/quotes/201448516/delayed AU:BHP -0.13% falling 1.3%.
“There is no doubt [China’s rate increase] is having a negative impact on the mining sector, particularly on the big diversifieds. Nonetheless, it’s very difficult to gauge to what extent, given the near nonexistent trading volumes,” said Ben Potter, market strategist at IG Markets.
Tower Australia surged 42% to 3.87 Australian dollars (US$3.91) after Dai-ichi Life’s /zigman2/quotes/200865545/delayed DCNSF -10.86% /zigman2/quotes/208507587/delayed JP:8750 +0.25% offer of A$4 per share. Its independent directors on Wednesday unanimously recommended that its shareholders accept the offer for the group.