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Asia stocks advance as China's economy grows more than expected

Key Points
  • Major Asian stock markets closed higher on Wednesday , following the release of better-than-expected economic numbers from China.
  • China said on Wednesday its economy grew 6.4 percent in the first quarter of 2019.
  • Analysts polled by Reuters had expected the country's gross domestic product to grow 6.3 percent year-on-year in the first three months of 2019. China grew by 6.4 percent year-on-year in the fourth quarter of last year, and 6.8 percent in the first quarter of 2018.

Most Asian stock markets closed higher on Wednesday, following the release of better-than-expected economic numbers from China.

Mainland Chinese shares were higher on the day. The Shanghai composite rose 0.29 percent to approximately 3,263.12 and the Shenzhen component added around 0.55 percent to about 10,344.43. The Shenzhen composite rose 0.721 percent to close at around 1,772.71.

Hong Kong's Hang Seng index was largely flat, as of its final hour of trading.

China said Wednesday its economy grew 6.4 percent in the first quarter of 2019, beating analysts' expectations. A Reuters poll predicted the country's gross domestic product would grow 6.3 percent year-on-year in the first three months of the year. China grew by 6.4 percent year-on-year in the fourth quarter of last year, and 6.8 percent in the first quarter of 2018.

"China's high frequency economic indicators confirm that growth is bottoming out," economists at Australia and New Zealand Banking Group wrote in a note following the data release.

"As the growth momentum of the Chinese economy picks up, we believe that policymakers will re-assess the need for further stimulus," they said.

The Australian dollar changed hands at $0.7199 following an earlier low of $0.7151. China is Australia's largest two-way trading partner, according to the latest data from Australia's Department of Foreign Affairs and Trade.

Investors have been watching the health of the Chinese economy — the world's second largest — amid Beijing's ongoing trade dispute with Washington. Official GDP figures are widely followed, but many experts have long expressed skepticism about the veracity of China's reports.

China also released housing price data on Tuesday, reporting that average new home prices rose faster in March compared to a month earlier, according to Reuters' calculation of data released by the National Bureau of Statistics.

"The housing data was interpreted as yet another signal that the China's policy stimuli are beginning to show a positive effect on the economy," Rodrigo Catril, senior foreign exchange strategist at National Australia Bank, wrote in a morning note.

Asia-Pacific Market Indexes Chart

Elsewhere in Asia, Japan's Nikkei 225 advanced 0.25 percent to close at 22,277.97, with shares of index heavyweights Fast Retailing and Fanuc rising 0.92 percent and 0.42 percent, respectively. The Topix index also added 0.26 percent to finish its trading day at 1,630.68.

Over in South Korea, however, the Kospi declined 0.12 percent to close at 2,245.89. The ASX 200 in Australia also fell 0.33 percent to end the trading day at 6,256.40 as almost all the sectors slipped.

DuluxGroup, Australia's largest paint maker, backed a A$3.81 billion (approx. $2.73 billion) takeover proposal from Japan-based Nippon Paint, Reuters reported. Shares of Dulux soared 27.12 percent following that announcement, while Nippon Paint dropped 3.62 percent.

Nippon's offer for Dulux comes as the Australian group's revenue growth slows and building materials suppliers face strong headwinds as an east coast homebuilding boom winds down and home values drop sharply, according to Reuters.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.864 after seeing lows around 96.8 earlier this week.

The Japanese yen traded at 111.97 against the dollar as it continued to trade in a range around the 112.0 handle.

Oil prices rose in Asian afternoon trade, with the international benchmark Brent crude futures gaining 0.4 percent to $72.01 per barrel and U.S. crude futures adding 0.67 percent to $64.48 per barrel.

— CNBC's Yen Nee Lee and Reuters contributed to this article.