Most Asian markets shrugged off geopolitical concerns on the Korean peninsula on Wednesday, turning positive after early cautious trade.
The Nikkei 225 gained 49.28 points, or 0.3%, to 20,081.63
The Hang Seng Index took on 132.96 points, or 0.5%, to 25,521.97.
North Korea claimed the missile it launched on Tuesday was an intercontinental ballistic missile capable of carrying a heavy nuclear warhead, with U.S. military officials confirming that it was an ICBM. The missile landed in Japan's exclusive economic zone
South Korea and the U.S. have responded to the North's missile launch by conducting an offensive ballistic missile drill
Defense stocks in South Korea were mixed as markets kept an eye on geopolitical developments in the Korean peninsula. Korea Aerospace closed lower by 0.9% but defense contractor Hanwha Techwinsaw its shares gain 1.7%.
Retail stocks in South Korea were mostly higher, with Lotte Shoppingshrugging off geopolitical concerns to close higher by 1.3%. Nomura research analysts Cara Song and Jiun Im had upgraded the stock from neutral to buy in a Tuesday note, citing the larger-than-expected unlocking of asset value as the company goes through restructuring.
Shares of Tencent in Hong Kong were higher by 0.5% in late trade a day after a popular mobile game made by the company was criticized online by a state-run newspaper. Tencent shares had ended the previous session down 4.1%
One Citi analyst Alicia Yap maintained a buy call on the company's stock in a Tuesday note, adding that the new playing-time limits implemented by Tencent will not have a material impact on revenue from the company's "Honour of Kings" game. She also said weakness in Tencent shares should be viewed as a buying opportunity.
In currencies, the yen traded at 113.29 to the U.S. dollar late afternoon The yen had strengthened to trade around 112.8 following Tuesday's missile launch in the previous session.
The Korean won came in softer against the greenback, trading at 1,149.53 to the U.S. dollar late afternoon Wednesday, compared with the dollar fetching as little as 1146.58 earlier in the session and with levels around 1,141 earlier in the week.
In Australia, shares of travel retail company Flight Centre closed up 10.4% after the company reported guidance for the next year. The company said underlying profit before tax was expected to range between $325 million and $330 million
The Australian dollar firmed to trade at $0.7619 U.S. The Aussie dollar had traded as low as $0.7595 overnight following the Reserve Bank of Australia's decision to hold interest rates steady on Tuesday.
CHINA
The CSI 300 recouped 39.7 points, or 1.1%, to 3,659.68
Greater China markets rose modestly as markets digested the release of Caixin services Purchasing Managers Index data for the month of June.
The Caixin services PMI showed on Wednesday that growth in China's services sector slowed in June. The Caixin services PMI fell to 51.6 from 52.8 in May. The June composite PMI, which takes into account both the services and manufacturing sectors, fell to 51.1, compared with 51.5 last month.
In other markets
In Taiwan, the Taiex index hiked 57.01 points, or 0.6%, to 10,404.79
In Korea, the Kospi index recovered 7.83 points, or 0.3%, to 2,388.35
In Singapore, the Straits Times Index hiked 37.54 points, or 1.2%, to 3,248.71
In New Zealand, the NZX 50 lost 24.98 points, or 0.3%, to 7,595.67
In Australia, the ASX 200 dropped 20.57 points, or 0.4%, to 5,763.25
