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Asian Stocks End Up on Portugal Bond Auction

Asian stocks rose on Thursday after a successful bond auction in Portugal eased fears about the euro zone's debt crisis and boosted European and U.S. stocks.

The FTSE CNBC Asia 100 index edged up 0.7 percent.

The Nikkei 225 rose to an eight-month intraday high for a second straight day on Thursday, a successful bond auction in Portugal eased fears about the euro zone's debt crisis and lifted European and U.S. shares.

Financials, which led Wednesday's advance, extended gains as foreign investors continued adding underweight banking stocks to their portfolios. Mitsubishi UFJ Financial Group, Japan's biggest bank by assets, gained 1.3 percent.

The property sector was also among the top gainers, as foreign funds piled into real estate shares supported by the Bank of Japan's asset buying scheme and as vacancy rates in first-class buildings in Tokyo fell in the October-December quarter.

The benchmark Nikkei ended up 0.7 percent or 76.96 points at 10,589.76. Immediate resistance looms at the May 13, 2010, high of 10,638.23. The next target eyed by investors is the 10,847.90 mark recorded on May 6. The broader Topix Index added 0.9 percent to 937.74.

Resource and energy shares posted strong gains as oil hovered around 27-month highs, with $100 a barrel looming for the first time since 2008 and as gold prices rose to a one-week high on Wednesday.

Inpex, Japan's top oil and gas developer, gained 2.1 percent to 492,500 yen, while trading houses rose. Marubeni, Japan's No.5 trading house, climbed 2.5 percent to 628 yen and No.4 Itochu added 2.9 percent to 910 yen.

Chuo Mitsui Trust Holdings rose 5.0 percent to 354 yen and Sumitomo Trust & Banking gained 5.3 percent to 537 yen in heavy trade, after the Nikkei business daily said that the entity to be created in April by merging the two firms is considering a dividend payout ratio of 30 percent.

The firms were the two biggest percentage gainers on the Nikkei 225.

KOSPI Eases on Options Expiry

Seoul shares ended lower on Thursday in volatile trading, as options expired and the central bank unexpectedly lifted interest rates, although that was offset by a rise in financial stocks.

The Korea Composite Stock Price Index (KOSPI) ended
down 0.26 percent at 2,089.48 points, off an all-time high touched earlier in the day, and after marking an all-time closing high in the previous session.

South Korea's central bank surprised markets on Thursday by raising interest rates to contain inflationary pressure, as record food prices and volatile commodities prices threaten an escalation in inflation.

Banking groups were further boosted by a local media report that a new banking law would allow the National Pension Service (NPS) to hold up to 10 percent of a South Korean bank as it is categorized as a financial entity. Its current ownership of South Korean banks is 5 to 7 pct on average. KB Financial Group climbed 3.1 percent and Hana Financial Group ended up 3.8 percent.

But, export-focused issues weighed on the overall market. The country's top automaker Hyundai Motor fell 0.8 percent and affiliate Kia Motors slid 1 percent.

Builders also lost ground, pressured by news of the rate increase, with the sector index down 0.56 percent. Daewoo Engineering & Construction fell 1.4 percent and GS Construction & Construction was down 1.2 percent.

Banks Fuel Hong Kong; Shanghai Rises

Hong Kong stocks rose with banks leading gains amid a broad global rally in financials.

The benchmark Hang Seng Index closed up 0.47 percent at 24,238.98, with turnover at the highest since Nov. 30, suggesting the latest gains had momentum.

China's benchmark Shanghai Composite ended 0.2 percent higher supported by strength in oil firms.

Petrochina, the largest company on the Shanghai stock exchange by market value, rose 1.3 percent while China Petroleum & Chemical gained 2 percent.

Australian stocks closed up 1.5 percent, with miners leading a broad-based rally as commodity prices firmed and euro zone debt fears abated while some were relieved Queensland's flood was not as bad as feared.

The fallout from Queensland's devastating floods were seen having a minimal impact on the market, as Insurance Australia Group became the latest insurer to unveil its estimate of claims from the disaster.

Australia's benchmark S&P/ASX 200 index rose 71.03 points to 4,795.

Energy firm Santos was put on trading halt pending a major announcement about its flagship $16 billion Gladstone LNG project.

Global miners BHP Billiton and Rio Tinto posted solid gains on stronger metal prices. BHP gained 1.9 percent while Rio added 2.2 percent.

Rail operator QR National rose 2.2 percent after it said most of its flood-affected lines could reopen as soon as Jan 20.

In Southeast Asia, Singapore's Straits Times Index and Malaysia's KL Composite both gained 0.3 percent.