By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Most Asian stocks rose Wednesday as a higher finish overnight for U.S. equities and gold prices encouraged buyers, and with Japanese shares rebounding after a three-day losing streak as the yen weakened.
Stocks in Hong Kong and Shanghai dropped amid worries about the strength of the economic recovery in China.
The advance followed a surprisingly strong increase in U.S. housing starts and better-than-expected earnings from companies including as Coca-Cola Co. /zigman2/quotes/209159848/composite KO +1.63% and BlackRock Inc. /zigman2/quotes/207946232/composite BLK +1.24% that spurred major stock indexes on Wall Street to gains of at least 1.1% overnight.
“Following a string of gloomy global economic data and a near meltdown in commodities, equity investors seem determined to cling to the coattails of the American dream and are once again bouncing to the tune of an expected continuation of monetary stimulus,” said CMC Markets sales trader Niall King.
Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +1.15% gained 1.1% while South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.81% and Taiwan’s Taiex edged 0.1% higher each.
Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.96% fell 0.5% for its fourth straight day of losses, and the Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 +2.74% eased 0.1%.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK +1.27% jumped 1.2%, as the U.S. dollar climbed back above ¥98, and after Credit Suisse on Tuesday raised its rating on Japanese equities to overweight .
Gains in Tokyo also took support from the International Monetary Fund’s upgrade of the country’s economic growth outlook for 2013 to 1.6%, applauding Japan’s aggressive new monetary easing, even as it downgraded U.S. forecasts.
Shares of Sony Corp. /zigman2/quotes/201361720/delayed JP:6758 +1.19% climbed 2.3%, Mizuho Financial Group Inc. /zigman2/quotes/204507985/delayed JP:8411 +0.23% /zigman2/quotes/200950467/composite MFG +0.43% rose 2.4% shipping firm Kawasaki Kisen Kaisha Ltd. /zigman2/quotes/201857679/delayed JP:9107 +7.53% gained 4.3% and Mazda Motor Corp. /zigman2/quotes/204777714/delayed JP:7261 -0.98% /zigman2/quotes/206326885/composite MZDAY -1.50% spiked 5.9% in a bounce spread across sectors.
“Risk sentiment as suggested by U.S. stock markets is unlikely to deteriorate sustainably. ... Any further weakening of Chinese growth expectations may result in renewed easing expectations,” said strategists at Crédit Agricole.
“We remain of the view that dips [in U.S. dollar versus the yen] should be bought, as the pair is ultimately still set to move higher,” they said.
Shares of Nomura Holdings Inc. /zigman2/quotes/206251373/delayed JP:8604 +1.55% /zigman2/quotes/207276383/composite NMR +1.34% dropped 2.3% after Italian police froze 1.8 billion euros ($2.35 billion) in funds from a unit of the investment bank as part of an investigation into Banca Monte dei Paschi di Siena /zigman2/quotes/202470451/delayed IT:BMPS -1.54% . The case stems from a structured-products transaction that the Nomura unit worked on with Monte dei Paschi.
Stocks bounce back after rout
Blue chips hold on to triple-digit gains, marking a rebound from their steep Monday dive after a bounce in gold prices and trio of upbeat earnings reports.
Telecommunications firm Softbank Corp. /zigman2/quotes/207303954/delayed JP:9984 +3.50% /zigman2/quotes/202815238/composite SFTBF +1.99% edged up 1.2%, following heavy losses Tuesday after Dish Network Corp. /zigman2/quotes/207505872/composite DISH +1.32% trumped its takeover bid for U.S. firm Spring Nextel Corp. /zigman2/quotes/208685669/composite S +5.45%
Worries about China’s economic momentum weighed on trading in Hong Kong and Shanghai after the mainland’s first-quarter gross domestic product growth disappointed earlier in the week.
Shares of luxury-goods maker Prada S.p.A. /zigman2/quotes/200575701/delayed HK:1913 +2.43% /zigman2/quotes/204689658/composite PRDSY -3.73% lost 2.3%, while footwear major Belle International Holdings Ltd. gave up 1.1%.
Among resource stocks, a few gold-linked names saw a mild recovery after recent losses, with gold miner Newcrest Mining Ltd. /zigman2/quotes/203840223/delayed AU:NCM +2.57% /zigman2/quotes/203286036/composite NCMGY +0.06% climbing 0.6% as gold futures settled higher overnight. In Hong Kong, Chow Tai Fook Jewellery Group Ltd. /zigman2/quotes/208947199/delayed HK:1929 +3.70% /zigman2/quotes/200609163/composite CJEWY +0.58% rose 1.5%.
BHP Billiton Ltd. /zigman2/quotes/201448516/delayed AU:BHP +2.05% /zigman2/quotes/208108397/composite BHP +2.20% fell 0.3% in Australia after reporting that its iron-ore output increased less than expected in the fiscal third quarter.