Asian stocks were mostly higher in the afternoon session Wednesday. Trade was thin as many investors were away for Christmas holidays. Japan closed higher be South Korea declined.
Other Asian markets including Australia and Hong Kong were shut, and many markets in Europe will also be closed.
Financial counters were on the rise with shares in South Korea's Kookmin Bank, Singapore's DBS Group Holdings and Japan's Mitsubishi UFJ Financial drawing support from news that U.S. investment bank Merrill Lynch, hit by huge subprime mortgage losses, confirmed a report that it would increase its capital with an investment from Singapore's Temasek Holdings. Merrill is the latest in a growing number of Wall Street firms to receive cash from sovereign wealth funds as the sector shores up balance sheets as the credit crisis plays out.
Japanese stocks finished at their highest in two weeks. The Nikkei 225 Average gained 0.65 percent, led up by technology shares and automakers such as Toyota Motor as the yen weakened and U.S. holiday spending data eased concerns that the major export market was tipping into recession. But shares of Sanyo Electric nosedived on concerns the Tokyo Stock Exchange may delist the company after it revised six years worth of financial statements.
Seoul shares fell for the first time in three sessions, with brokerages retreating as a rally that started before Christmas lost steam, while petrochemical firms slid on a price-fixing investigation. Banks such as Kookmin Bank also trimmed gains from news of a foreign capital injection into Merrill Lynch, as investors grew cautious about the pace of the sector's rally, which had been driven by the victory of a business-friendly candidate in last week's presidential election. But shares in STX Corp, the holding company of STX Group, surged 10.4 percent following news that its unit, STX Energy, would buy stakes in three oil exploratory wells near Faroe Islands and Ireland from Royal Dutch Shell for an estimated $140 million.
Singapore's Straits Times Index was up almost 1 percent in very thin trade with bank and property counters lifting the market.
China's Shanghai Composite Index was flat as financial shares sagged and other large-caps were soft. But most shares rose and turnover stayed active. Second and third-tier stocks outperformed, as financials remained depressed by concern that tightening monetary policy would hurt profit growth next year.