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China stocks shrug off easier trading rules; rest of Asia up

Asian stocks outside the mainland advanced on Thursday, tracking the strong finish on Wall Street overnight, but uncertainty over Greece's debt situation and the release of U.S. nonfarm payrolls data later in the day capped gains.

Meanwhile, mainland stocks took another tumble to finish below the 4,000 mark despite regulators' efforts to put a floor to the market turmoil.

Less than 24 hours after he wrote a conciliatory letter to creditors asking for a new bailout, Greek Prime Minister Alexis Tsipras delivered a combative speech on local television, urging Greeks to vote "no" at the referendum on July 5. The remarks come a day after the cash-strapped nation became the first advanced economy to default on debt to the International Monetary Fund (IMF).

Overnight, U.S. stocks handed over an impressive lead, with the help of better-than-expected economic data. The Dow Jones Industrial Average and S&P 500 gained 0.79 and 0.69 percent, respectively, while the tech-heavy Nasdaq closed up 0.53 percent.

Symbol
Name
Price
 
Change
%Change
NIKKEI
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HSI
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ASX 200
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SHANGHAI
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KOSPI
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CNBC 100
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Mainland indices extend losses

China's Shanghai Composite index settled down 3.49 percent at its lowest level since April 9, with news of easier margin rules doing little to lift trading sentiment. Earlier on, the Shanghai bourse plunged as much as 258 points or 6 percent.

It was also a sea of red elsewhere in the mainland; the blue-chip CSI 300 index tanked 3.4 percent to a near three-month low, while the smaller Shenzhen Composite plummeted 5.6 percent to its lowest close since May 8.

On Wednesday, China's securities regulator relaxed rules on using borrowed money to make stock purchases after the Shanghai bourse ended another erratic trading session more than 5 percent lower.

The move comes on the back of a bigger-than-expected easing package over the weekend, where the People's Bank of China (PBOC) cut the benchmark one-year lending and deposit rates by 25 basis points, and reduced the RRR by 50 basis points, after panic selling over the past two weeks erased more than 20 percent from the benchmark index.

"[It] seems very much that they are desperate," Michael Kurtz, global head of equity strategy at Nomura, told CNBC. "[The fact that] markets sold down further after the weekend rate cuts was a wake-up call to the leadership that they need to do something more forceful and unambiguous to signal that it's 'ok' to get back into the market."

In Hong Kong, the Hang Seng index moved up 0.12 percent on its return from a public holiday.

Outperforming the bourse, gaming plays such as Sands China and Galaxy Entertainment soared more than 10 percent each, thanks to news that the Macau government will relax visa rules for mainland tourists.

Nikkei jumps 1%

Japan's Nikkei 225 leaped to a near one-week high, with exporters and insurers leading the charge in the broad-based rally.

Nissan and Honda Motor soared 2.7 and 3.5 percent, respectively, following a strong showing in U.S. sales for the month of June. Meanwhile, T&D Holdings and Dai-ichi Life Insurance tacked on more than 2 percent each.

Troubled electronics maker Sharp surged 8.6 percent after Standard & Poor's decision to remove its selective-default designation, sparked by a de facto debt-for-equity swap, putting its long-term corporate credit rating at B-. Takara Printing closed up 7 percent after setting its dividend ratio at 88.8 percent for the year ending May 2016.

Index heavyweight Fast Retailing also contributed a significant upward push for the bourse with a surge of nearly 3 percent.

ASX rises 1.5%

Australia's S&P ASX 200 index was the star performer in Asia on Thursday.

Early-trade laggards including Woodside Petroleum and Santos rebounded 1.8 and 2.9 percent, respectively, while Newcrest Mining bolstered 1.2 percent.

Among gainers, QBE Insurance advanced 2.2 percent, while Westpac and National Australia Bank bumped up nearly 2 percent each. Challenger climbed 2.7 percent after announcing that it sold its 25 percent stake in Kapstream Capital to Janus Capital Group for approximately $34.36 million.

Underperforming the market, Kathmandu sagged 0.3 percent after the outdoor clothing and equipment retailer urged its shareholders to take no action on the takeover proposal from New Zealand retailer Briscoe Group.

Meanwhile, the Australian dollar pulled back modestly after May trade data came in worse than expected. The Aussie currency was last quoted at $0.7636 to the dollar, compared with $0.7643 at the open, after Australia's trade deficit came in at 2.75 billion Australian dollars. Reuters had expected a deficit of 2.2 billion Australian dollars.

Kospi adds 0.5%

South Korea's Kospi index finished at its highest level since May 29.

Among the stocks in focus, Samsung Heavy Industries added 0.3 percent to Wednesday's 13.2 jump, thanks to news that the company won a 5.3 trillion won order from Shell Gas & Power Developments to build three FLNG facilities in Europe.

Hyundai Motor — the bourse's second heaviest-weighted stock — eased 0.7 percent on the back of news that the automaker's global sales fell for a third straight month in June.

Meanwhile, a South Korean court on Wednesday denied a request from U.S. activist fund Elliott to block a shareholder vote on a proposed $8 billion merger between Samsung C&T and Cheil Industries. While the former edged up 0.6 percent, the latter pared earlier gains to close down 0.6 percent.