China's broad-based reform plans got a thumbs-up from the markets, with Hong Kong and mainland shares climbing Monday, leading regional gains, with positive cues from Wall Street Friday providing a fillip.
Hong Kong's Hang Seng Index jumped 2.7 percent to end at 23,660.1, its highest close since February, while China's Shanghai Composite tacked on 2.9 percent to end at 2197.22. The Nikkei 225 ended essentially flat, down 1.62 point at 15,164.30 after surging 7.7 percent last week, while Korea's Kospi index finished up 0.3 percent at 2010.81.
India's Sensex added 2.23 percent to 20,853.37, tracking regional gains, bolstered by hopes the U.S. Federal Reserve will continue its stimulus program.
Bucking the trend, Australian shares fell, with the S&P/ASX shedding 0.3 percent to end at 5377.90.
Hong Kong, China shares rise
China late on Friday unveiled bold reform plans from its Third Plenum, including easing the one-child policy, implementing residence registration reforms, allowing market pricing of key resources and further financial liberalization.
"The reform package will have a long-lasting positive impact on China's equity market outlook," Deutsche Bank said in a report, forecasting the MSCI China index would rise 20-25 percent over the next 12 months.
(Read more: China's economic reforms: What you need to know)
"We expect market sentiment to be significantly lifted, as investors will gradually understand the increase in China's growth potential and the improving sustainability of the economic, financial, real estate, and social security systems due to reforms," it said.
Citigroup said the reforms allowing the issuance of municipal bonds will be positive for banks, while deposit-rate liberalization would be positive for insurance, brokerage and consumer finance firms.
In a report, Nomura recommended pursuing an investment theme of a shift toward "good," mass-market driven consumption, adding its model portfolio overweights mass-market consumption proxies including brokers and insurers.
In Hong Kong, China banks rallied, with China Merchants Bank climbing 9.4 percent, Bank of China up 3.6 percent and Agricultural Bank of China up 5 percent. Brokerage Citic Securities surged 13 percent, while China Life added 8.7 percent and Ping An Insurance climbed 9.5 percent.