Asian stocks rejoice at offshore gains, Japan Post debut

A pedestrian walks past a share prices board showing the numbers on the Nikkei 225 at the Tokyo Stock Exchange in Tokyo, Japan.
Kazuhiro Nogi | AFP | Getty Images
A pedestrian walks past a share prices board showing the numbers on the Nikkei 225 at the Tokyo Stock Exchange in Tokyo, Japan.

Asian stocks rose sharply on Wednesday, as a confluence of factors including a stellar market debut from Japan Post's units in Tokyo and positive Chinese data fueled risk appetite in the region.

A fifth straight day of gains for energy counters alongside a rise in tech majors helped propel major U.S. averages overnight. The Dow Jones Industrial Average and S&P 500 ended up 0.5 and 0.3 percent respectively, while the tech-heavy Nasdaq Composite gained 0.4 percent. The Nasdaq 100 closed up 0.3 percent at 4,719.05, topping its previous record close set in March 2000 during the dotcom bubble.

"Part of [the rise in energy stocks] was due to news of possible supply disruption in Brazil and Libya, pushing the price of Brent crude higher and in general, there's a tight correlation between the movements in Brent and energy stocks. I see a favorable backdrop for investing in energy: cheap valuations, low expectations and i think oil prices could move higher from here so that's a good formula for success," Brian Jacobsen, chief portfolio strategist at Wells Fargo Advantage Funds, told CNBC.

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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Nikkei up 1.3%

Japan's Nikkei 225 index was one of the biggest gainers in Asia on Wednesday, thanks to a strong market debut by Japan Post Holdings and its two financial units.

Japan Post Holdings ended at 1,760 yen in its long-awaited market debut, 25.7 percent higher than the initial public offering (IPO) price of 1,400 yen. Meanwhile, Japan Post Bank jumped 15.2 percent to close at 1,671 yen, versus an IPO price of 1,450 yen, while Japan Post Insurance traded at 3,430 yen, significantly higher than its 2,200 yen IPO price.

"It's a healthy [transformation] and it paints a picture of where they should be going. It's already welcomed by investors, judging by the prices of all three [stocks]," Steve Quirk, SVP, Trader Group at TDAmeritrade, told CNBC's "Street Signs Asia" on Wednesday.

Among other gainers, T&D Holdings, Dai-ichi Life Insurance and Tokio Marine Holdings bounced up about 4 percent each, with buy orders spurred by the upbeat sentiment surrounding Japan Post's market debut.

Inpex led gains in the energy sector, surging 4 percent on the back of a near 4 percent leap in oil prices overnight.

Nissan rallied nearly 3 percent after the carmaker raised its operating profit outlook for the year, while Daihatsu Motor rose 5.4 percent as investors cheered news of CLSA raising its rating for the stock to 'underperform' from 'sell.'

By contrast, Takata plunged 13.4 percent, hurt by news that it could be fined up to $200 million for lapses in its recall of faulty air bag inflators.

The Tokyo index was closed for a public holiday in the previous trading session.

China stocks surge

Share markets in China were bolstered by data which showed activity in China's services sector expanded at its fastest pace in three months in October.

Released earlier in the session, the Caixin/Markit purchasing managers' index (PMI) rose to 52.0 in October from September's 14-month low of 50.5, hitting the highest level since July 2015.

In other news, President Xi Jinping said Tuesday the country's economic growth rate will not be less than 6.5 percent in the five years to 2020, according to a report by Reuters citing state-run Xinhua news agency.

"Markets and investors are reacting to some reassuring comments from policymakers and also reassuring indication from the macro environment," Xavier Denis, global strategist at SG Securities, said. "In the short run, we are heading to a year-end rally and [Chinese stocks] should deliver positive returns in the weeks ahead but if you consider a long term approach, there are still concerns about Chinese growth deceleration and when the Fed will hike rates."

The key Shanghai Composite index closed up 4.3 percent, while the blue-chip CSI300 index surged 4.7 percent.

In Hong Kong, the benchmark Hang Seng index pulled back from earlier highs, up 2 percent late Wednesday.

Comments from Chinese central bank governor Zhou Xiaochuan that a stock market trading link between Hong Kong and Shenzhen could be launched before the end of 2015, fanned risk sentiment earlier in the session. However, reports have since emerged at mid-day saying that Zhou's comments were made on May 27, according to an update from Dow Jones citing Chinese data provider Wind.

As such, Hong Kong Exchanges and Clearing halved gains to 4.4 percent, while other mainland brokerages such as Citic Securities and Haitong Securities bounced up 8.4 and 7.5 percent respectively.

Taiex jumps 1.7%

Taiwan's weighted index hit a more than three-month high, with tech plays extending gains following a rally in their U.S. counterparts and following news that President Ma Ying-jeou will hold talks with China's Xi in Singapore on Saturday.

The historic meeting, which is the first since the civil war ended in 1949, comes at a sensitive time in Taiwan, with presidential elections due in January 2016. In reaction to the news, Taiwan's main opposition party said on Wednesday that cross-strait issues should not be used as an election ploy.

Large-cap Taiwan Semiconductor Manufacturing Co. more than doubled gains to 3.6 percent, while key tech names such as Catcher Technology and Hon Hai Precision Industry climbed more than 1 percent each.

ASX flat

Australia's benchmark S&P ASX 200 index surrendered almost all of its gains as financials turned negative in late-day trade.

Westpac, National Australia Bank and Australia and New Zealand Banking sagged between 0.1 and 0.6 percent, while Commonwealth Bank of Australia held on to modest gains of 0.1 percent.

Elsewhere in the market, BHP Billiton nearly halved gains to 2 percent, while Rio Tinto and Fortescue Metals closed up 0.5 and 1.4 percent respectively.

Building products maker CSR was among the top performers of the day, up 3.1 percent on the back of releasing strong half-year profit and expectations of improved full-year earnings.

Retailers turned mixed as official data showed September retail sales met market expectations with a rise of 0.4 percent. Harvey Norman trimmed gains to 0.8 percent, while Myer and JB Hi-Fi notched down 0.5 and 0.6 percent respectively.

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Kospi adds 0.2%

South Korea's Kospi index ended a choppy trading session marginally higher.

Refiners SK Innovation, S-Oil and GS Holdings rallied between 0.9 and 3.8 percent.

Hyundai Motor, which announced on Wednesday it would be launching a new global luxury car brand called Genesis, tacked on nearly 2 percent. But Kia Motors dropped 1 percent, a day after surging more than 2 and 4 percent respectively, on the back of industry data which showed a rise in domestic auto sales last month.

The Seoul bourse was also hamstrung by a fall in its top weighted stock, Samsung Electronics, which receded 1.6 percent.

SET gains 0.6%

Thailand's benchmark SET index bounced up in rangebound trade ahead of the Bank of Thailand's (BOT) monetary policy announcement.

According to HSBC's economist Nalin Chutchotitham, the central bank is in no hurry to cut rates after the announcement of stimulus measures worth a combined 364 billion baht ($11.2 billion) earlier this month. In addition, comments from Governor Veerathai Santiprabhob on October 21 about how a prolonged low-rates environment may compromise long-term economic stability suggest "lingering reservations about lowering rates further," Chutchotitham added in a note dated October 30.