Asian stocks edged mostly higher on Monday with the Japanese Nikkei moving past the 10,500 mark for the first time in ten months, buoyed by a strong close on Wall Street Friday after a U.S. jobs report underpinned hopes the world's largest economy was on track for recovery.
Additionally, an unexpected surge in Japan's core machinery orders in June, a closely watched indicator of corporate capital spending, also boosted investor sentiment. Though some of the markets in the region closed off their early highs, the mood was fairly bullish.
Crude oil price, which closed notable lower at $70.93 a barrel, down $1.01 per barrel in New York trading on Friday, traded steady at above $71 per barrel in late Singapore trading on Monday.
The Japanese market closed at a fresh 2009 high, buoyed by strong global cues, solid earnings and a weaker yen. The benchmark Nikkei 225 index rose 113 points or 1.08% to 10,524, the best finish since Oct 3 and the Topix index of all the Tokyo Stock Exchange First Section issues rose 12 points or 1.3% to 969. The Nikkei has risen over 16% in the last 19 sessions.
Exporters such as auto and electronics makers closed firm due to the weakness of the yen against the U.S. dollar. Honda Motor rose 3.55%, Toyota gained 1.47%, Sony added 3.15%.
Petrochemicals maker Mitsubishi Chemical Holdings surged up 4.73% on reports that it plans to acquire plastics company Mitsubishi Rayon in a deal worth up to 200 billion yen. On the other hand, Mitsubishi Rayon climbed 20%. Tire makers Bridgestone Corp. rallied 5.62% after boosting its outlook
The Australian market ended modestly up after briefly trading at its highest level in 10 months in early trading. The benchmark S&P/ASX 200 index closed at 4,304, up 5 points or 0.11% and the broader All Ordinaries index rose 6 points or 0.14% to 4,309.
Commonwealth Bank slipped 1.37% ahead of the announcement of its earnings on Wednesday. National Australia Bank edged down 0.16%, ANZ eased 0.46% and Westpac Banking fell 0.74%, but investment bank Macquarie Group rose 1.21%.
Miner Rio Tinto fell 3.33% amid reports that it overcharged Chinese steelmakers by 700 billion yuan ($102 billion) for its iron ore over six years. Its rival BHP Billiton also slipped 0.63%, but Iluka Resources surged up 4.31%.
Iron ore producer Fortescue Metals Group swung to a full-year profit following a $A925.83 million loss in the previous year. The stock ended down 5.67%.
In economic news, the Reserve Bank of Australia announced that official reserve assets increased in July to US$44.05 billion from US$42.44 billion in June.
The South Korean market closed virtually unchanged, as profit-taking in some banks and technology stocks more than outweighed the market's earlier gains. The benchmark KOSPI gained 0.11 points or 0.01 percent to 1,576 and volume was moderate at 485 million shares worth 5.63 trillion won (US$4.59 billion) with gainers outnumbering losers by 479 to 33.
Net purchases by foreign funds totaled KRW340.5 billion, while domestic institutions sold a net KRW425.9 billion worth of stocks.
The International Monetary Fund again raised the economic outlook for South Korea, citing the positive impact of government's stimulus measures and the prevailing low interest rate. Lifting the outlook, the IMF said the economy is set to shrink 1.8% in 2009 and recover with a 2.5% growth in 2010. Earlier in July, the lender had estimated a 3% contraction for this year.
New Zealand's NZX-50 index rose 12 points or 0.4% to 3,081. Gainers led losers by 33 to 7, while 8 stocks closed unchanged. Stock exchange operator NZX which posted a surge in profit on asset sales rallied 3.15% and Mainfreight rose 2.68% to $4.98, the highest close since May 21.
Among other gainers, Air New Zealand rose 1.69%, Fisher & Paykel Healthcare advanced 1.82%, Goodman Property Trust gained 2% and ING Property Trust jumped 4.05%. Auckland International Airport rose 0.57% after successfully selling NZ$25 million of seven-year bonds in a private placement.
Retailers Pumpkin Patch and Warehouse Group closed firm, while Hallenstein Glasson edged down 0.36% after data from eftpos transactions company Paymark showed that retail spending in New Zealand rose 1.1% in July year-over-year.
Fletcher Building fell 1.91% ahead of the announcement of its annual result on Wednesday and Telecom edged down 0.72% after 900 lines engineers who work for contractors Transfield Services and Downer EDI went on a strike.
On the economic front, New Zealand's house prices climbed in July, for the third consecutive month, indicating an increase in buyer optimism and activity levels, the latest report from the Quotable Value said Monday. Residential property values climbed 0.7% from June, and were up 1.3% from the low seen in April
Hong Kong's Hang Seng index finished 554 points or 2.72% higher at 20,930, its highest closing level since September 2008, as Chinese bank stocks, which were sold off in recent sessions on worries of a clampdown on lending in China recovered.
Bucking the rising trend across the region, China's benchmark Shanghai Composite index, which tracks both A and B shares, ended down 11 points or 0.3% to 3,250 because of lingering liquidity concerns. Banks and property developers bore the brunt of the selling pressure on concerns about possible deceleration in earnings.
Meanwhile, India's benchmark Sensex was last trading in the red, weighed down by worries over a deficient monsoon. The BSE Sensex was trading at 15,062, down 90 points or 0.59%, dragged down by auto, FMCG and capital goods stocks.
On Wall Street, the major U.S. averages gained between 1.2%-1.4% on Friday after a Labor Department report showed that the pace of job losses slowed by even more than economists had been anticipating in the month of July. The Labor Department also said that the unemployment rate unexpectedly edged down to 9.4% in July from 9.5%, recording a decrease for the first time since April 2008.