By V. Phani Kumar, MarketWatch , Shri Navaratnam and Wei-Zhe Tan
HONG KONG (MarketWatch) — Most Asian markets climbed Thursday, with robust gains in Chinese resource stocks offsetting a sharp fall in property developers after Beijing unveiled a fresh set of measures to check rising home prices.
The Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.23% advanced 1.5% and Hong Kong’s Hang Seng index /zigman2/quotes/210598030/delayed HK:HSI -1.01% fell 0.3%, while Taiwan’s Taiex edged 0.5% higher.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.39% rose 0.7% on the back of strong expectations for earnings reports, with Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.33% ending little changed.
South Korea’s Kospi index rose 0.2%.
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“I think it’s just a technical rebound ... Before the weekend there will be concerns that the Chinese government may raise interest rates again and I don’t expect the market to jump sharply,” said Conita Hung, head of equities at Delta Asia Financial Group.
Investor sentiment in the region was also underpinned by mild gains on Wall Street and also by the U.S. Federal Reserve’s decision to continue with its controversial $600 billion bond-purchase plan to support the economy.
Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.44% futures were down 18 points in screen trade.
“The key message (from the Fed) seems to be that the economic recovery is continuing, but the rate is deemed too slow to bring about sufficient improvement in the labor market,” Credit Agricole said in a note to clients.
Chinese stock markets opened lower as property developers tumbled after Beijing decided to raise the minimum down payment on second-home purchases to 60% from 50% late Wednesday in an effort to cool the property market further. The State Council also called on local authorities to set reasonable 2011 property price targets by the end of the first quarter and decided to limit home purchases in some big cities and cities where property prices were deemed to have risen too fast. Read full story in Asia Markets.
But the strength of commodity prices on Wednesday lifted resource stocks in Shanghai, while automobile stocks also advanced on hopes for an improvement in 2011 sales.
Jiangxi Copper /zigman2/quotes/204256025/delayed JIXAY -2.94% /zigman2/quotes/201334192/delayed CN:600362 +0.07% rose 3.8% and Zhongjin Gold Corp. /zigman2/quotes/207741711/delayed CN:600489 +4.04% climbed 4.5%, while SAIC Motor Co. /zigman2/quotes/201442870/delayed CN:600104 +3.48% added 2.8%.
Property developers were hit hard, with Poly Real Estate Group /zigman2/quotes/201864015/delayed CN:600048 -1.92% dropping 4.3% in Shanghai and China Vanke Co. /zigman2/quotes/205643772/delayed CN:000002 -2.21% falling 2.5% in Shenzhen.
In Hong Kong, however, the fall in mainland property shares forced the market’s retreat after a choppy session, with China Overseas Land & Investment /zigman2/quotes/205731176/delayed HK:688 -1.98% /zigman2/quotes/202573805/delayed CAOVY -2.42% skidding 4.9% and China Resources Land /zigman2/quotes/202417326/delayed HK:1109 -1.83% /zigman2/quotes/209191868/delayed CRBJY +7.06% giving up 3.9%.
“The authorities are waiting for property-price inflation to slow to below 6.0%, which we expect will occur” in the first quarter of 2011, said ING economist Prakash Sakpal. If this slowdown didn’t occur, officials’ next step would be to introduce a property tax, he said.