Japanese stocks on Monday posted their biggest percentage gain in more than three months as strong economic data from the U.S. and Europe on Friday reinforced investor confidence that an economic recovery is underway.
The Nikkei 225 index in Tokyo surged 342.85 points, or 3.4%, to close the week’s first session at 10,581.05, with automobile shares rebounding from Friday's weakness, while cyclical stocks such as commodity producers pacing the advance on economic recovery hopes. Shares of Sumitomo Metal Mining rose 4.4% and Inpex climbed 5.4%.
In Hong Kong, the Hang Seng index regained 336.92 points, or 1.7%, to 20,535.94.
Stocks were bolstered following strong gains Friday on Wall Street after data showed that existing home sales in July increased at a better-than-expected pace and Federal Reserve Chairman Ben Bernanke said the economy was beginning to emerge from its worst crisis in generations.
Resource stocks rallied across the region, with BHP Billiton jumping 4.3% and Rio Tinto climbing 4.7% in Sydney, Korea Zinc advancing 5.2%, Cnooc climbing 3.5% in Hong Kong.
In Tokyo, Toyota Motor added 2.3% and Honda Motor gained 3.2% after Goldman Sachs said its coverage view on Japanese auto makers remained attractive in spite of the end of the U.S. government's "cash for clunkers" incentive program later Monday. A weakened yen also helped most exporters.
Shares of convenience store operator Lawson rose 2% and drugstore chain Matsumotokiyoshi Holdings added 0.2% after the two agreed to a broad alliance, including for the sale of over-the-counter medicines.
Lead Japanese government bond futures were lower on weakness in U.S. Treasurys on Friday, and a bounce in Asian stocks. September bond futures ended down 0.29 points at 138.91, while the 10-year cash bond yield was up 2.0 basis points at 1.325%.
Mizuho Securities analyst Masashi Shimominami said that the 10-year JGB yield may rise to 1.390% this week as U.S. and Japan stock prices remained on an upward trajectory.
Shares of Alibaba.com jumped 10.5% in Hong Kong, after its parent group announced a restructuring of its China Yahoo business in a move that may stoke a growing rift between the company and its single-largest shareholder, Yahoo.
Alibaba said last week that it would separate Koubei.com, a classified-listings web site, from China Yahoo and transfer the unit to its retail web site, Taobao.com.
Shares of China Petroleum & Chemical rose 0.7% in Hong Kong and 2.2% in Hong Kong after the refining giant Sunday said its first-half profits more than quadrupled.
CHINA
Chinese shares in Shanghai advanced after last week's roller-coaster ride amid concerns Beijing might fine-tune policies to prevent bank loans being used for stock market purchases and tighten banks' capital requirements.
Shanghai’s 300 Composite Index added 25.98 points, or 0.8%, to 3,229.60
Elsewhere:
Singapore’s Straits Times Index progressed 67.47 points, or 2.7%, to 2,612.33
South Korea’s Kospi index gained 31.24 points, or 2%, to 1,612.22
Taiwan’s Taiex moved higher by 183.45 points, or 2.8%, to 6,838.25
New Zealand’s NZX 50 Index tacked on 32.72 points, or 1.1%, to 3,067.67
Australia’s S&P/ASX 200 recovered 135.50 points, or 3.2%, to 4,426.10.
