Asia Markets

Nikkei closes at 7-year peak after surprise BOJ easing, GPIF reports

Japanese shares outperformed their Asian peers on Friday following easing measures from the Bank of Japan and updates from the world's largest pension fund.

The Japanese central bank unexpectedly increased the pace at which it expands base money to about $726 billion per year, citing concerns that a decline in oil prices would hurt consumer prices. That saw the yen weaken to 111 against the dollar, its lowest level since 2008, and Japan's benchmark index spike as much as 5 percent in the final hour of trade.

"We think the key part of this announcement is they are trying to drive all doubts out of the market to achieve the desired goal. This is what ever it takes to achieve success and success is defined by 2 percent inflation.... Even for Japanese who doubt Abenomics, if this doesn't drive the doubt out of your mind, I don't know what will," said Ed Rogers, CEO & CIO at Rogers Investment Advisors.

Separately, Reuters reported that a government panel approved plans for the Government Pension Investment Fund (GPIF), the world's largest, to raise its allocation of domestic stocks to 25 percent of its portfolio from 12 percent currently.

Positive data from the U.S. overnight also lifted the mood in Asia. U.S. third-quarter gross-domestic product (GDP) on Thursday rose 3.5 percent, beating expectations.

For the month of October, Hong Kong and Australia were the region's best performers with gains exceeding 4 percent in each market.

Nikkei rallies 4.8%

Japan's benchmark Nikkei index ended at its highest level in seven years, extending gains into a third session, while the Topix closed over 4 percent higher. Earlier in the session, the Nikkei soared over 5 percent to an intra-day of 16,533 points.

This is 'fist-thumping action from BOJ': Expert
This is 'fist-thumping action from BOJ': Expert

Toshiba rallied 4.5 percent after net profit increased 43 percent in the fiscal first-half from a year earlier, and Fujitsu tanked nearly 4 percent despite a 64.5 percent profit rise during the same period.

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A raft of September data released before the market open painted a mixed picture of the economy. Consumer price inflation rose 3 percent on year, in line with expectations, but household spending fell 5.6 percent on year, below estimates.

Shanghai rallies 1.2%

Mainland shares rallied to their highest level since February 2013 for a second session after the government unveiled measures to boost consumption earlier this week.

Financials rallied with Agricultural Bank of China over 2 percent higher after third-quarter net profit rose 6 percent on year. Bank of China closed up 3.7 percent after net profit increased an annual 5 percent during the same period.

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Sinopec eased 0.3 percent, paring losses following a 2 percent slide earlier, after third-quarter net profit tanked 12 percent on year..

A guide on existing trade deals in Asia
A guide on existing trade deals in Asia

ASX 0.9% higher

Australia's benchmark rose to its highest level since September 15, up for a second session, with financials in focus on the back of earnings results.

Australia New Zealand Banking added 0.7 percent after posting a 10 percent rise in full-year cash profit while Macquarie rallied over 2 percent after first-half net profit rose 35 percent.

Meanwhile, New Zealand shares rose to another record high for the seventh straight session.

Kospi gains 0.3%

South Korean shares reversed opening losses, with the Kospi rising to a new three-week high.

Samsung Electronics climbed over 5 percent, extending gains from Thursday's 4 percent rally, on hopes of a dividend increase or share buyback program.

Hyundai Heavy, the world's largest shipbuilder, closed 0.8 percent lower, paring losses from a 7 percent slide earlier, after reporting a record quarterly loss of $1.8 billion.

Nifty 1.3% higher

Indian shares rose to a record high for the second straight session as investor optimism rose over recent government reforms.