Asian markets ended mixed Monday in a session marked by thin trading volumes, with Japanese stocks erasing early declines to bounce back as investors shrugged off news that the country has slid into a recession.
The benchmark Nikkei 225 Stock Average index closed up 60.2 points or 0.7% at 8,522.6 while the benchmark Hang Seng Index closed down 13.1 points or 0.1% at 13,529.5.
Japan's Cabinet Office said before the markets opened that the Japanese economy contracted 0.1% in the third quarter of 2008 compared to the previous quarter, marking the second consecutive quarter of decline and confirming suspicions that the world's second-largest economy is in a technical recession. Japan's Gross Domestic Product, or GDP, was down a revised 0.9% in the preceding second quarter. On an annualized basis, GDP was down 0.4% in the third quarter after a revised 3.7% contraction in the second quarter.
Meanwhile, the Ministry of Economy, Trade and Industry said that Japan's tertiary industry activity eased 0.6% in September compared to the previous month, posting an index score of 108.5. That was slightly worse than analyst expectations for a 0.5% monthly decline and follows a revised 1.3% monthly fall in August.
Among banks, Mitsubishi UFJ slid 1.5%, Mizuho Financial declined 1.1% and Sumitomo Mitsui shed 2.2%. Top brokerage Nomura Holdings fell 2.8%.
Some exporters rose as the dollar climbed back above 97 yen after sliding as low as 95.87 yen. Honda gained 1.6%, Sony and Canon rose 0.7% each, and Nikon advanced 1.1%, Toyota dipped 0.3%. Nissan dropped 0.8% after the automaker said that it would cut production in Japan by another 72,000 vehicles over the rest of the business year to March. This is in addition to a cut of 65,000 vehicles announced in October.
The standout gainers were defensive stocks. Takeda Pharmaceutical jumped 2.8%, Eisai surged 3.3% and Daiichi Sankyo soared 5.4%.
However, real estate firms plunged. Mitsui Fudosan plummeted 5.2%, Mitsubishi Estate tumbled 5.4% and Sumitomo Realty & Development declined 2.7%.
In the tech space, Advantest fell 2.5%, but Fanuc edged up 0.4% and Kyocera advanced 0.6%.
Among commodity-related stocks, Inpex Holdings tumbled 3.4%, but Nippon Oil added 0.3%. Trading house Mitsubishi Corp dropped 1.6% and Mitsui & Co plunged 3.5%.
CHINA
The Chinese stock market closed higher for a fourth day on optimism about the government's economic stimulus package. The benchmark Shanghai Composite Index opened lower after a weekend meeting of world leaders in Washington failed to produce any concrete measures to tackle the global financial crisis but rebounded to close up 44.1 points, or 2.2%, at 2,030.4.
Construction-related stocks continued to rally on expectations of more government spending on airports, highways and other projects. Hebei Taihang Cement soared by the daily limit of 10% for the eighth trading day and China Railway Erju jumped 10%.
Most major airlines advanced after state newspapers reported that the Chinese government is likely to inject 3 billion yuan into China Eastern Airlines and China Southern Airlines. Air China and China Southern Airlines surged up 9.9% each, and China Eastern Airlines jumped 10.0%.
Among banks, Bank of China rose 2.4%, Pudong Development Bank added 2.1%, and Industrial & Commercial Bank of China climbed 1.0%.
Market heavyweight PetroChina gained 0.8% oil refiner Sinopec jumped 5.4%.
Elsewhere:
Taiwan's Taiex closed down 0.3% at 4,439.
Singapore's STI closed down 0.5% at 1,749.
Indonesia's Jakarta Composite Index closed down 2.2% at 1,236.
Malaysia's KLCI closed up 2.4 points at 884.
South Korea's Kospi struggled to stay in positive territory, before ending 0.9% lower at 1,078.32.
New Zealand's NZX 50 index shed 0.9% to 2,741.92.
Australia's S&P/ASX 200 dropped to its lowest level since September 2004, before paring some losses to end down 2.5% at 3,653.
with files from other wire services
