Most of the Asian indexes closed in positive territory Thursday following a very choppy trading session, with South Korea closing almost 2% higher. Energy shares rallied as oil held near a record peak above $80 set overnight.
Crude oil prices hovered near a record high of $80 a barrel as dealers focused on tight inventories in the U.S. and potential supply disruptions from a tropical storm in the Gulf of Mexico. This gave oil counters a boost.
Australia's Caltex and Santos both climbed, while Japan's INPEX Holdings and Nippon Oil jumped on expectations that higher crude prices will boost the value of their assets feed through to profits. The surge in oil prices comes a day after OPEC agreed to a small production hike in an effort to soothe consumer nations' fears that soaring crude costs could slow economic growth.
Japanese stocks ended mixed with the Nikkei 225Average creeping up on defensive buying of medical shares such as Terumo, while strong oil prices boosted energy shares. But the broad TOPIX index slipped, and trade was thin as a waiting mood deepened ahead of the selection of a new Japanese prime minister and next week's Federal Reserve meeting. Selling of high-tech stocks such as Toshiba weighed on the market and limited gains.
South Korea's KOSPI closed 1.9% higher as LG Electronics surged on hopes for strong quarterly earnings, while Doosan Group units rallied on speculation it would restructure into a holding company format. Trading was volatile due to the simultaneous quarterly expiries of stock options, stock index options and stock index futures at the end of the session, an event known in markets as triple witching day.
Australia's S&P/ASX 200 Index finished slightly higher, buoyed by gains in energy firms such as Woodside Petroleum as oil prices stayed near record highs, though CSR dropped after a share placement.
Hong Kong blue chips hit a record high and managed to close 0.9% higher as investors cashed in recent outperformers such as Hutchison Whampoa, while property shares rallied amid the prospect of a U.S. rate cut. Hong Kong-listed shares in mainland companies dropped nearly 1%, as investors sold off Aluminum Corp of China (Chalco) after Alcoa shed its entire stake in the company. Chalco fell as much as 11%.
Singapore's Straits Times Index finished largely flat, but shares of Neptune Orient Lines, the world's eighth-biggest container shipping firm, fell over 3% weighed down by record high oil prices and a JPMorgan downgrade.
Chinese shares closed 2% higher following a volatile trading day as concern about monetary policy and increased supplies of equity continued to make investors cautious, though buying back in some big financial stocks boosted the main index.