China shares closed in bull-market territory Thursday, after two days of sharp gains added steam to the slow recovery that has been under way since August.
The Nikkei 225 continued its win streak, 189.5 points, or 1%, to 19,116.41,
In Hong Kong, the Hang Seng edged down 2.53 points to 23,051.04
Central banks were the main driver of the region’s gains in October, although shares have been choppy this month, as investors temper their expectations for further stimulus. The Bank of Japan and the Reserve Bank of Australia held off on introducing easing in the past week.
Overnight, U.S. Federal Reserve Chairwoman Janet Yellen said that a rate increase at the central bank’s December meeting was a "live possibility." A move would be the first increase in rates for the U.S. since 2006 and would increase borrowing costs for companies globally.
U.S. stocks slipped overnight and the U.S. dollar gained ground against other currencies following Yellen’s remarks.
The Japanese yen recouped its overnight losses and was last at ¥121.55 against the U.S. dollar, roughly flat compared with its level in late Asian trade Wednesday.
The yen fell to its weakest level since late August overnight, hitting ¥121.71 to one U.S. dollar. A weaker yen is generally positive for Japanese stocks, particularly those of exporters.
Shares in Japan extended a rally from the previous day when state-owned Japan Post Holdings Co. and its financial units jumped in an initial public offering that was the world’s largest since Alibaba Group Holding Ltd. made its debut last year.
Japan Post Holdings Co. was up 3.4%, while its financial units Japan Post Insurance Co. and Japan Post Bank Co. rose 13% and 6.2% respectively.
Shares of SoftBank Group Corp. recovered to finish up 0.5% after the company’s chairman said during an earnings presentation Wednesday that thousands of jobs would be cut at Sprint Corp. as part of a turnaround effort at the struggling U.S. wireless carrier.
SoftBank bought Sprint in 2013. SoftBank also reported earnings that missed analysts’ expectations, posting a net profit of ¥213 billion ($1.76 billion U.S.) in the July-to-September quarter.
Weakness in commodity prices hit the sector in Australia, with energy shares in the S&P/ASX 200 falling.
CHINA
The CSI 300 in Shanghai leaped 77.43 points, or 2.1%, to 3,705.97
Thursday’s gains add to a 4% jump on Wednesday when mainland shares had rallied on speculation, fueled by out-of-date comments by the central bank, that Chinese authorities would roll out a new trading link to further open up their market to foreign investors.
A recovery of Chinese shares—which shed 43% from June to August—gained momentum ahead of a high-stakes meeting between Chinese President Xi Jinping and Taiwanese President Ma Ying-jeou this Saturday, the first between China and Taiwan since the two sides split in 1949 after the Chinese civil war.
Last week, leaders in Beijing wrapped up a four-day annual meeting where they pledged to spur more competition in several state-dominated industries including oil, electricity, natural gas and telecommunications, according to China’s official Xinhua News Agency.
This week, Xi hinted at a range of possibilities for China’s official five-year growth target, which won’t be announced until March, saying that China could maintain its current pace this year of “about 7%,” the lowest level in a quarter-century.
In Shanghai, shares of brokerages outperformed on expectations that a rebounding market would translate into higher trading volumes. Industrial Securities Co. Everbright Securities and Huatai Securities Co. Ltd. all hit their 10% maximum daily limit set by regulators.
In other markets
The Kospi index in Korea lost 3.36 points, or 0.2%, to 2,049.41
Taiwan’s Taiex index slid 6.84 points, or 0.1%, to 8,850.18
In Singapore, the Straits Times Index dumped 16.83 points, or 0.6%, to 3,023.65
The NZX 50 added 2.42 points to 6,073.63
The ASX 200 dropped 49.32 points, or 0.9%, to 5,192.97
