By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Most Asian markets rose Thursday as a record finish for key U.S. indexes and hopes for Japanese central-bank easing lifted sentiment, while Chinese stocks climbed after a boost in bank lending and expectations for lower corporate taxes.
The Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -2.13% ended 2% higher at 13,549.16, a level it hasn’t seen since July 2008. The benchmark ended higher for the sixth time in seven trading days, with the U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -0.0064% staying just short of the key ¥100 level.
“Aggressive easing by the Bank of Japan has been rapidly priced by global rates markets, as investors search for yield. However, global equities are only starting to price the [Bank of Japan] actions as ‘risk on,’” said Barclays analyst Guillermo Felices.
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“The current environment remains pro-equities, and even if differentiation across regions and sectors may persist, we expect global equities to rally further,” Felices said.
Elsewhere, Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.75% ended 0.8% higher and South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -1.05% overcame intraday losses to finish up 0.7%, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.31% gained 0.3% in afternoon trading.
The Shanghai Composite /zigman2/quotes/206600939/delayed CN:000001 +0.80% was one major exception to the broader regional trend, ending down 0.3%.
The broad advances in Asia came after the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -4.42% and the S&P 500 /zigman2/quotes/210599714/realtime SPX -4.42% both ended at record levels overnight on Wall Street. U.S. equity index futures were mixed by late afternoon in Asia, with the DJIA futures up 0.1%, the S&P 500 futures flat and the Nasdaq 100 futures off 0.1%.
In Tokyo, the rally was spread across sectors, with exporters, financials and industrial shares again among the gainers.
Shares of Mazda Motor Corp. /zigman2/quotes/204777714/delayed JP:7261 -3.43% /zigman2/quotes/206326885/delayed MZDAY -4.68% climbed 4%, Mitsubishi Heavy Industries Ltd. /zigman2/quotes/202419396/delayed JP:7011 -2.65% jumped 10.3%, and banking giant Mitsubishi UFJ Financial Group Inc. /zigman2/quotes/207520099/delayed JP:8306 -1.29% climbing 2.6%.
Sharp Corp. /zigman2/quotes/203224600/delayed JP:6753 -4.05% /zigman2/quotes/200401218/delayed SHCAY -4.45% soared 7.9% after a Nikkei news report that the company will post an October-March operating profit well above forecasts, thanks to payroll cuts and increased sales of LCD panels.
Shares of Takata Corp. plunged 9% following reports that defects in airbags made by the company led to a recall of at least 3 million vehicles worldwide by Japan’s three largest auto makers — Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co.
Shares of the auto makers themselves ended sharply higher in the upbeat market, however. Toyota /zigman2/quotes/200537742/composite TM -2.76% /zigman2/quotes/203803129/delayed JP:7203 -2.13% stock jumped 5.8%, while Honda /zigman2/quotes/207173990/composite HMC -1.59% /zigman2/quotes/200490352/delayed JP:7267 -0.73% and Nissan /zigman2/quotes/207656007/delayed NSANY -4.16% /zigman2/quotes/208298710/delayed JP:7201 -2.39% added 3.1% and 4.4%, respectively.
The advances in Hong Kong came after data released by the People’s Bank of China showed the country’s financial institutions extended 1.06 trillion yuan ($171 billion) /zigman2/quotes/210561991/realtime/sampled USDCNY 0.0000% credit in March, sharply higher than the 620 billion yuan in loans they made in February.
Hopes for tax reforms also aided market sentiment, after the State Council — China’s cabinet — on Wednesday decided to implement nationwide a pilot program that replaces a tax on overall sales with a value-added tax, Xinhua news reported. The move is expected to reduce the tax burden on businesses.
Shares of Aluminum Corp. of China Ltd., or Chalco, /zigman2/quotes/202960704/delayed HK:2600 -0.47% /zigman2/quotes/208051344/composite ACH -4.09% added 2.7%, Bank of Communications Co. /zigman2/quotes/203442771/delayed HK:3328 +1.18% /zigman2/quotes/202128064/delayed BCMXY -9.89% rose 1.2% and personal-hygiene products maker Hengan International Group Co. /zigman2/quotes/205777105/delayed HK:1044 +0.50% /zigman2/quotes/209671890/delayed HEGIY -1.62% advanced 2.8% to lead a broad-based rally in Hong Kong.
In Shanghai, shares of China Eastern Airlines Corp. /zigman2/quotes/205483076/composite CEA -1.93% /zigman2/quotes/208816122/delayed CN:600115 0.00% climbed 2% after receiving the industry regulator’s approval to raise funds by issuing new yuan-denominated shares.
But metals producers retreated after rallying earlier in the week, with Chalco /zigman2/quotes/210453246/delayed CN:601600 -1.25% losing 2.8% and Jiangxi Copper Co. /zigman2/quotes/201334192/delayed CN:600362 -0.96% /zigman2/quotes/204256025/delayed JIXAY -8.05% shedding 1.6%.
In Seoul, construction-related and industrial stocks suffered deep losses after the Bank of Korea surprised markets by refraining from a widely expected interest-rate cut.
But a 1.3% advance for heavyweight Samsung Electronics Co. /zigman2/quotes/209800866/delayed KR:005930 -1.06% /zigman2/quotes/202367843/delayed SSNLF 0.00% , along with broad gains for the financial sector, helped the market rebound from early losses.
Australian shares, led by gains in banks and retailers, managed to end higher despite unexpectedly weak official jobs data. Commonwealth Bank of Australia /zigman2/quotes/200638713/delayed AU:CBA -1.08% /zigman2/quotes/207018701/delayed CBAUF -1.78% rose 1.1% and Woolworths Ltd. /zigman2/quotes/209906204/delayed AU:WOW -1.25% added 1.4%, with Woolworths getting an extra lift from a quarterly gain in same-store sales.