Chinese stocks rebounded from a four-session losing streak Tuesday, shrugging off economic indicators that mostly fell short of expectations.
Most other Asian markets also ended higher in a choppy session ahead of the two-day Federal Open Market Committee meeting in Washington, as analysts remained hopeful of a continued recovery in corporate earnings.
The Nikkei 225 index in Tokyo gained 61.20 points, or 0.6%, to 10,585.46, its highest finish since early October.
Earlier in the day, the Bank of Japan kept its interest rate at 0.1% and left its cautiously optimistic economic assessment unchanged. The Bank of Korea also left its benchmark interest rate unchanged at 2%, as expected, and remained cautious on the outlook for the nascent economic recovery.
In Hong Kong, the Hang Seng index charged ahead 144.69 points, or 0.7%, to 21,047.21, ending above the 21,000-point level for the first time in nearly a year.
Shares of City Developments jumped 3.1% and Oversea-Chinese Banking Corp. jumped 4.7% in Singapore.
In Tokyo, insurers led the market gains, with Tokio Marine trading up 2.1% and Mitsui Sumitomo Insurance Group Holdings.
Late Monday, Mitsui Sumitomo Insurance said its April-June group net profit rose 37%, thanks to sharp gains from derivative trading.
But Tachibana Securities analyst Kenichi Hirano warned that after sharp recent gains, a correction "could start any minute, but buying by foreigners is preventing it."
In Sydney, shares of mining giant Rio Tinto fell 1.1% on fears about its relationship with China, its biggest iron ore customer.
The weakness came in spite of comments from Australia's Foreign Minister Stephen Smith on Tuesday that allegations on a Chinese Web site that Rio executives had cost the country more than $100 billion U.S. by stealing state secrets weren't Beijing's official view.
A big gainer in Seoul was Ssangyong Motor Co., shares of which jumped 14.8% to clinch hefty gains for a fourth straight session, after some of its creditors reportedly said they have withdrawn a liquidation petition for the car maker in light of union workers having ended a labour strike.
In Hong Kong, shares of bourse operator Hong Kong Exchanges & Clearing climbed 3.7% on improving trading activity, with listed Chinese banks tracking gains in Shanghai.
But Hong Kong heavyweights China Mobile and HSBC Holdings declined, by 0.4% and 0.5% respectively, in the aftermath of sharp gains recently.
CHINA
Shanghai’s 300 Composite Index regained 11.84 points, or 0.3%, to 3,556.38.
Automobile stocks broadly advanced, with banks also managing gains in spite of data on bank lending showing a slump in July from June levels.
Shares of SAIC Motor Corp. rose 2.2%, while Bank of China gained 0.5% in Shanghai. In Shenzhen, FAW Car Co. added 1.6%.
Official data released Tuesday showed China's industrial production and investments in urban fixed assets increased at a rapid but slower-than-expected rate. Retail sales increased at a faster-than-projected pace in July, though monthly consumer and producer price indexes matched analyst estimates.
"China's outperformance in [the first half of 2009], versus the rest of the world, was partly a result of its faster inventory build. But this boost may be fading," said Royal Bank of Scotland economist Ben Simpfendorfer.
Elsewhere:
Singapore’s Straits Times Index returned from holiday with a gain of 47.95 points, or 1.9%, to 2,579.30
South Korea’s Kospi index picked up 0.11 points, or 0.01%, to 1,576.11
Taiwan’s Taiex advanced 26.15 points, or 0.4%, to 6,909.02
New Zealand’s NZX 50 Index lost 25.50 points, or 0.8%, to 3,055.47
Australia’s S&P/ASX 200 moved ahead 27.90 points, or 0.7%, to 4,332
