Japanese shares ended well off their highs Monday, as the yen strengthened from morning levels after the Bank of Japan's emergency policy meeting resulted in additional easing steps that fell well within market expectations.
Japan’s Nikkei 225 Index gained 158.20 points, or 1.8%, to 9,149.26
Hong Kong’s Hang Seng Index picked up 139.87 points, or 0.7%, however, to 20,737.32, to end its losing streak at six straight sessions.
After the market closed, Japanese Prime Minister Naoto Kan reportedly said the government planned to compile economic stimulus using 920 billion yen ($10.8 billion U.S.) in reserves from this fiscal year's budget.
Shares of most Japanese exporters ended higher, although they came off the session's highs, with Toshiba Corp. rising 1%. Toyota Motor Corp. erased its gains and ended down 0.4%.
The results of the meeting were announced at the midday trading break in Tokyo. As many expected, the BOJ said it would expand its current 20 trillion yen quantitative-easing program to six months from the current three-month time frame.
The central bank also increased the amount of funds available by ¥10 trillion. The decision to extend the easing was by an 8-1 vote, with policy board member Miyako Suda dissenting.
Unlike its last special easing in December, this time, the central bank's decision lacked the element of surprise.
While BOJ Governor Masaaki Shirakawa returned earlier than planned from the U.S. central bank's Jackson Hole, Wyo. conference, many analysts had expected that the BOJ would call an emergency meeting this week ahead of its next regularly-scheduled one in September.
The yen recovered after the BOJ's announcement.
The U.S. dollar, which rose as high as ¥85.88 earlier on Monday, fell back as analysts weren't hopeful that the gains could last -- which would bode poorly for exporter shares. A strong currency erodes their repatriated overseas profits, and also makes their products more expensive and less competitive in overseas markets.
The greenback was buying ¥84.73 in late Tokyo trading, from ¥85.39 in late North American trading on Friday.
Elsewhere;
Shanghai’s CSI 300 Index surged 56.44 points, or 2%, to 2,915.01
Singapore’s Straits Times Index added 18.32 points, or 0.6% to 2,957.06
Korea’s Kospi index improved 30.57 points, or 1.8% to 1,760.13
Taiwan’s Taiex Index increased 18.29 points, or 0.2%, to 7,741.20
New Zealand’s NZX index gained 29.37 points, or 1%, to 3,036.81
Australia’s S&P/ASX 200 prospered 82.60 points, or 1.9%, to 4,452.70
