Asia Lower on Fed Minutes; Nikkei Up 2.8%

Asian shares ended mostly lower on Friday, tracking overnight weakness in global equities after several Fed officials expressed concerns about continuing to expand stimulative bond buying. But, Japanese stocks surged as the market played catch-up with the region on its first trading day of 2013.

"No-one in their right mind could expect such central bank largesse to continue indefinitely but many were shocked that the Fed may be pulling the plug on QE3 within the next 12 months," said Jason Hughes, Head of Premium Client Management, IG Markets in a note.

ASX 200
CNBC 100

The FTSE CNBC Asia 100 index nudged up 0.1 percent.

Japan's Nikkei share average rose to a 22-month high on its first trading day of 2013 as a deal in Washington to avert the "fiscal cliff" buoyed investor risk appetite and a weaker yen lifted exporters like Toyota Motor.

The benchmark Nikkei closed up 2.82 percent at 10,688.11 on Friday, while the broader Topix gained 3.34 percent to 888.51.

Exporters were in demand, with Toyota adding 6.4 percent, Honda Motor advancing 4 percent and Canon gaining 2.4 percent.

(Read More: 2013 Could Be the Year Japan Turns Around: Economist)

Sharp bucked the trend by falling 2.6 percent to 295 yen after the Yomiuri newspaper reported on Jan. 1 that it is considering raising more than $1.2 billion to bolster its capital base.

South Korean shares ended lower on Friday as the country's export champions in electronics, cars and shipbuilding came under selling pressure from a cheaper yen.

The Korea Composite Stock Price Index (KOSPI) closed down 0.4 percent at 2,011.94 points, falling for the second straight day but still holding on to 9-month highs.

Heavyweight Samsung Electronics shed 1.2 percent, despite expectations for a blockbuster fourth-quarter. A leading market researcher told Reuters that Samsung is expected to widen its lead over Apple in the smartphone market.

Shares in Apple supplier LG Display also fell 2.5 percent, after a local brokerage voiced concerns about its first quarter earnings.

Hyundai Heavy Industries, the world's largest shipbuilder, lost 2 percent, a day after it said it aims to win $29.7 billion in orders this year, compared to $19.5 billion in 2012, a 52 percent increase.

Australian shares eased 0.4 percent on Friday, with miners consolidating recent gains and investors taking a breather after some senior U.S. Federal Reserve officials expressed concerns about continuing to expand stimulative monetary policy.

The S&P/ASX 200 index was down 16.9 points at 4,723.8 after hitting 20-month highs in the previous session

Top miners lost ground after hitting their highest since last February on Thursday. BHP Billiton dropped 0.6 percent, while Rio Tinto fell 1.0 percent despite December record iron ore shipments to China.

Gindalbie Metals rallied 10.7 percent to A$0.31, the biggest one-day rally in more than 10 weeks, after it shipped the first shipment of magnetite concentrate to China from the Karara iron ore project on Wednesday.

Shares in construction company Macmahon Holdings rose 1.8 percent after it confirmed receiving a conditional proposal for its construction business from Sembawang Australia, a local arm of India's Punj Lloyd.

New Zealand's benchmark NZX 50 index ended down 0.1 percent to 4,075 points.

Mainland China shares eked out a gain to start 2013, with a rise in property counters on anticipated demand helping reverse midday losses as investors returned on Friday from a three-day New Year holiday.

The CSI300 of the top Shanghai and Shenzhen A-shares closed up 0.1 percent at 2,524.4. The Shanghai Composite Index crawled up 0.4 percent. Both indexes closed at their highest since mid-June. They rose 1.8 and 2 percent respectively this week, when mainaland markets had only two days of trading.

(Read More: Why Hong Kong's Bull Market Will Last )

Hong Kong shares ended their best week in six on a weaker note, as investors took profit on outperformers in the past two days after the U.S. Federal Reserve signalled growing concerns about its stimulative monetary policy.

The Hang Seng Index closed down 0.3 percent for the day, but up 2.9 percent this week at 23,331.1. The China Enterprises Index shed 0.4 percent on Friday, but jumped 4.9 percent this week.

The Fed's asset-purchase program has been among the chief reasons for the swelling inflows into the Chinese territory that have buoyed markets. Fed reticence about further growing its $2.9 trillion balance sheet could limit capital flows, knocking the Hang Seng Index off 19-month highs.

This week's gains were the China Enterprises Index's best in nearly a year. For the Hang Seng, it was the best week since the one that ended November 23.

Chinese non-banking financials were among the biggest drags after leading the surge in the first two trading days of 2013. China Life Insurance fell 1.9 percent from Thursday's 18-month high, while Ping An Insurance dropped 2.1 percent.

Citic Securities, China's largest listed brokerage, which fell 3.8 percent on Thursday, sank another 4.3 percent on Friday.

Gold mining stocks were also weak as gold prices slipped 1 percent. Zijin Mining slipped 2.9 percent in Hong Kong while Zhongjin Gold lost 2.7 percent in Shanghai.

In Southeast Asia, both Singapore's Straits Times Index and Malaysia's KLCI Composite Index traded flat.

India's BSE Index and the 50-share NSE Index ended 0.1 percent higher, both marking their highest closes since January 2011.