Japan leads Asia stocks higher, but Shanghai sluggish

Japan leads Asia stocks higher, but Shanghai sluggish

Hong Kong: Tokyo stocks touched a seven-month high as Asian markets mostly rose on Thursday, but Shanghai remained jittery amid expectations of economic tightening measures.

Tokyo’s Nikkei index rose 0.21% by midday after briefly reaching a high of 10,298.25, Hong Kong’s Hang Seng was up 0.44% and Sydney’s S&P/ASX 200 climbed 0.78%. But the Shanghai Composite Index was off by 0.36%.

Tokyo’s rise was led by banks and insurers, bucked by a surge in financial stocks on Wall Street.

Spirits were also lifted by news that Japan’s economy grew by more than previously thought in the third quarter due to capital spending by companies, with year-on-year growth revised up to 4.5%, although there was caution about the fourth quarter.

Japanese stocks, particularly exporters, were helped by a relatively weak yen.

In Asian trade the dollar bought ¥83.79, slightly down from ¥84.03 in New York earlier, while the euro bought ¥111.48, compared with 111.43.

The euro strengthened to $1.3306 compared with 1.3259.

Sydney meanwhile enjoyed a boost as data showed unemployment eased to 5.2% in November from 5.4% in October. Underpinning this was an unexpected surge in full-time employment that took the total number of people in work to 11.417 million.

“It’s quite positive for the share market," Dow Jones Newswires quoted Anthony Anderson, a senior trader at MF Global, as saying. “If there’s still some strength in employment, I think that’s a good sign for equities."

Chinese shares were doing less well as investors remain cautious ahead of November inflation data due on Saturday, amid expectations of an interest rate hike or other measures to damp down the mainland economy.

Rate hike anticipation has grown since October’s consumer price index showed a 4.4% year-on-year rise in prices, well above Beijing’s 3% comfort zone, particularly as food prices have surged.

In Shanghai, falls were led by property developers such as China Vanke and Poly Real Estate.

“The rate hike overhang may continue to drag China stocks until a move is confirmed by the People’s Bank of China," commented Haitong Securities.

Stocks closed modestly higher on Wall Street earlier -- defying a big fall in bond prices -- as traders awaited the conclusion of a tax-cuts deal between President Barack Obama and Republican foes in Congress.

The Dow Jones Industrial Average advanced 0.12%, the broader S&P 500 index gained 0.37% and the tech-rich Nasdaq climbed 0.41%.

On oil markets, freezing temperatures in Europe helped push prices above $89, with sharp US crude inventory falls providing further cheer.

New York’s main contract, light sweet crude for January delivery, was up 79 cents at $89.07 a barrel. Brent North Sea crude for January climbed 72 cents to $91.49.

Gold opened at $1,383.00-1,384.00 an ounce in Hong Kong, down from Wednesday’s close of $1,392.00-1,393.00.