Asian Stocks
Asian Stocks Reuters

Asian stock markets mostly advanced Monday as better-than-expected U.S. non-farm payroll data boosted sentiment.

Japan's benchmark Nikkei gained 0.72 percent or 88.08 points to 12,371.70, Hong Kong's Hang Seng advanced 0.35 percent or 81.96 points to 23,173.91 and India’s BSE Sensex gained 0.15 percent, while Chinese Shanghai Composite declined 0.24 percent or 5.57 percent to 2,313.04 and South Korea's Seoul Composite slipped 0.10 percent.

The U.S. Labor Department Friday reported that 236,000 jobs were added in February, far better than the Reuters' forecast for a gain of 160,000 jobs. The unemployment rate declined to 7.7 percent in February, the lowest rate since December 2008, from 7.9 percent in the previous month.

However, a mixed bag of economic data from China and downgrade of Italy by Fitch over the weekend limited the upward move. Official data released Saturday showed inflation in the world's second largest economy increased more-than-expected in February while industrial production and retail sales were weaker than forecast, with factory output increased 9.9 percent on annual basis in the first two months , the lowest since October 2012, and retail sales slipping to 12.3 percent.

Data from the National Bureau of Statistics showed that China inflation surprised on the upside. Consumer Price Index (CPI) rose 3.2 percent on an annual basis in February, the highest level in ten months, compared to 2.0 percent increase in January and above the analysts’ expectation of 3 percent rise, raising concerns that the government will start monetary policy tightening to cool prices.

“Another sign of caution came from China over the weekend, as data pointed to unexpected slowdown of growth in manufacturing in the first two months of 2013. CPI inflation surged last month by more than consensus had it, suggesting that the need to curb prices may well lead to monetary tightening and additional downward pressure on growth,” a note from Credit Agricole said.

Japanese shares advanced, led by gains from exporter companies’ shares as the dollar continued to remain at multi-year highs against the yen. Nissan Motor Co. Ltd. surged 3.22 percent and Sony Corp. gained 2.60 percent while Toshiba Corp. climbed 5.54 percent.

AIA Group Ltd. gained 2.37 percent and Cathay Pacific Airways Ltd. rose 0.27 percent in Hong Kong, while Industrial Bank Co. Ltd. declined 2.79 percent and China Minsheng Banking Corp. Ltd. declined 1.99 percent in Shanghai.