China bucks trend as Asia enjoys 'Santa rally' in pre-Christmas session

On the last trading session before Christmas, Asian indices largely rose, with the exception of China, as a strong U.S. growth report card revived risk sentiment. However, volumes remained low, with markets in Australia, Hong Kong and Singapore only open for half day ahead of tomorrow's holiday.

Overnight, Wall Street enjoyed a "Santa rally" as investors cheered data showing the U.S. economy expanded in the third quarter by the most in 11 years. The Dow Jones Industrial Average closed 0.4 percent higher at 18,024 points - its first finish above the 18,000 level - while the S&P 500 advanced 0.2 percent. However, the Nasdaq Composite fell, snapping a four-session winning streak, as biotechnology names weighed.

ASX 200
CNBC 100

Nikkei jumps 1.2%

Japan's benchmark Nikkei 225 share index touched a two-week high of 17,854 points on Wednesday, after being shut for a public holiday in the previous session, as dollar-yen broke through the 120 mark.

That pushed exporters' stocks higher, with Honda and Toyota Motor advancing 2.1 and 1.6 percent each. Sony, which announced Tuesday it will allow the movie "The Interview" to open in selected theaters on Christmas Day, charged 4 percent higher.

Gains in index heavyweights also lifted the share index; Uniqlo clothes brand owner Fast Retailing surged nearly 3 percent while Softbank added 0.3 percent.

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Mainland indices lower

On the last trading session before the Christmas holiday, China's Shanghai Composite index lost 1.9 percent to hit a two-week low on Wednesday, adding to a 3 percent plunge in the previous session.

Large cap financial stocks led declines; Bank of Communications and China Construction Bank receded over 5 percent each, while Agricultural Bank of China and Bank of China made losses of 4.5 and 4 percent, respectively.

Brokerages also put up a dismal performance on Wednesday. Citic Securities and Haitong Securities slid nearly 9 percent, respectively.

Media reports of fresh infrastructure projects failed to excite builders as China Railway Group fell 7.5 percent and Anhui Conch traded flat. On Tuesday, China's National Development and Reform Commission (NDRC) approved $4 billion worth of new bridge and road construction projects, state media said. The new investments come on the heels of approvals worth 209 billion yuan announced two days ago.

In Hong Kong, the Hang Seng index finished little changed. Property developer Greentown China outperformed the bourse to elevate 21 percent after it said China Communications Construction Group (CCCG) is buying a 24.29 percent stake in it for $775 million. Shares of the state-owned CCCG fell 5.6 percent in Shanghai and 9 percent in Hong Kong.

ASX gains 0.3%

Australia's benchmark S&P ASX 200 index erased early losses to settle above the flatline in a shortened Christmas eve session, but gains were pared by mixed trading in the commodity sector.

Miners fell in tandem with declining iron ore prices; BC Iron finished 4.2 percent lower and Fortescue Metals dropped 0.4 percent. Gold stocks also fell, with Evolution Mining losing 4 percent and Newcrest Mining trading 1.4 percent lower as spot gold kept low after a blowout U.S. growth data lifted the dollar.

However, banking majors capped losses as National Australia Bank notched up 1 percent while Westpac Banking and Australia and New Zealand Banking Group closed up 0.5 percent, respectively.

Meanwhile, the Australian dollar recovered modestly from a 4-1/2-year trough against its U.S. counterpart to trade at $0.8112by 1330 SIN/HK. The local currency fell below the key $0.8100 level overnight as demand for iron for construction fell in China and after Australia's Prime Minister Tony Abbott warned of heightened "terrorist chatter."

Kospi adds 0.3%

South Korea's Kospi index edged up ahead of the Christmas holiday, while the junior Kosdaq index added 0.5 percent.

The top gainer was Hyundai Motor, which piled on nearly 3 percent on hopes that the automaker will hike its dividend payouts.

LG Electronics climbed 0.4 percent after reports said it is launching a Firefox OS-powered smartphone in Japan, while rival Samsung Electronics saw a modest rise of 0.2 percent.