Asian stocks gain as yen grabs focus

By staff and wire reports

HONG KONG, China - Asian stocks gained ground on Tuesday, breaking their recent run of losses.

Japanese stocks got a boost from the weak yen, which was again the focus of Asian trade. The Nikkei ended up 1.05 percent at 10,432.17.

The yen broke back through the 128 mark against the U.S. dollar on Tuesday morning, after comments from Finance Minister Masajuro Shiokawa suggested the central Bank of Japan will ease monetary policy at its meeting that ends Wednesday.

The yen drove as high as 128.27 against the dollar after Shiokawa's comments, and outdid that mark in European trade, though it was back at 128.26 late in the day, local Japan time.

That was putting pressure on currencies such as the Korean won, the Taiwanese dollar, the Singapore dollar and the Thai baht.

Stocks in South Korea ended with a loss on worries about Hynix Semiconductor. The market was also down more than 2 percent in Taiwan.

Stocks were down more than 1 percent in New Zealand. But the two largest Pacific markets after Japan, Australia and Hong Kong, ended with gains for the day.

Stocks were also showing a strong showing in Singapore shortly before the close, after a holiday. They were off slightly in Mumbai in afternoon trade in India.

Topix back from three-year low

In Japan, the broader Topix index ended up 0.37 percent at 992.61. During the day, the Topix - which covers all the stocks trading on Tokyo's first section - hit a low for the year at 983.55.

That is also its lowest point since October 1998.

The index was hurt by a drop in stock of phone company Nippon Telegraph and Telephone Corp.


Toshiba's plans to sell a plant to Micron might spell bad news for South Korea's Hynix, which dropped sharply

Softbank confirmed on Tuesday that it will offer cheap long-distance calls - at 7.5 yen (6 cents) for three minutes - starting next year. That will undercut competitors like NTT.

After the end of trade, Japan's largest chipmaker, Toshiba Corp., said it will post a special loss of 40 billion yen ($313.6 million) in the year through March, to restructure its chip business.

Toshiba is also cutting its work force by 10 percent, to 29,000 by the end of March. Its stock rose 2.0 percent to 459 yen ahead of the announcement.

The weak yen boosted stocks of exporters such as Sony Corp. and Canon Corp., up 5.57 percent to 4,550 yen.

In Australia, the benchmark S&P/ASX 200 index ended up 0.94 percent at 3,320.5.

Most sectors strong in Sydney

It got a strong showing from most main elements, including banks and mining stocks.

The largest listing, media company News Corp., rose 1.7 percent to A$15.24. It accounts for around 10 percent of the index.

Westpac Banking Corp. led the bank rally, rising 2.6 percent to A$15.31.

Takeover target Normandy Mining rose 1 cent to A$1.81 on heavy turnover. AngloGold extended its bid for the company through January 4, but rival Newmont still has a higher offer..

Qantas Airways was a laggard, down 15 cents to A$3.71, as it faces industrial action over the Christmas period.

In New Zealand, the NZSE-40 index gave way to selling, ending down 1.2 percent at 2,021 on heavy turnover.

Stock in Auckland Airport fell 3.7 percent to NZ$3.66 as the city council's plan to sell its quarter stake in the company weighed on investor minds.

Changi Airport Enterprises Pte Ltd. sold its 7.1 percent stake at a 6 percent discount on Monday night.

Telecom New Zealand suffered heavy selling, falling 2.4 percent to NZ$4.86, with overseas investors cashing out.

South Korea fears for Hynix

In South Korea, the Kospi index fell 0.7 percent to 643.76.

Investors were worried Micron Technologies might scrap its takeover talks with Hynix Semiconductor in favor of a Japanese partner.

Hynix fell the 15 percent limit for a one-day move in Korea, to 2,080 won. Larger rival Samsung Electronics Co. rose 3.99 percent to 260,500 won.

But trading was light. The Korean won lost some ground against the dollar, after morning strength, and stands at 1,283.5 to the U.S. currency.

In Taiwan, the Taiex fell hard, down 2.33 percent to 5,329.19.

A weaker Taiwan dollar shook the market - as did an earthquake that registered 6.7 on the Richter scale, hitting northern and eastern parts of the island.

The quake rocked the market, which rose more than 2 percent in morning trade.

Taiwan Semiconductor Manufacturing Co., Taipei's largest listing and the world's largest contract chip maker, said its plants weren't affected. TSMC rose 1.85 percent to T$82.50.

Hong Kong up despite mainland drag

Hong Kong's Hang Seng index closed with a 0.18 percent gain at 11,486.93.

Trading was held back by a poor showing from China plays. China Mobile, the mainland's largest cell phone company, fell 0.53 percent to HK$27.90.

China Unicom dropped 0.57 percent to HK$8.75.

Hong Kong's main airline, Cathay Pacific, was down 1.55 percent to HK$9.50 ahead of a meeting of its pilots union on Wednesday.

China's B share markets in Shanghai and Shenzhen both gained as the domestic A shares rallied after a two-week slide.

In Singapore, the Straits Times index was up 1.37 percent in the last hour of trade, down from the day's highs but holding steady on a strong showing from bank stocks.

Indian stocks were off 0.32 percent in afternoon trade, still rattled by last week's suicide attack on parliament, but were regaining a little lost ground.

Reuters contributed to this report.