Asian Markets Close Higher, Boosted by Financials

Asian markets finished the week higher across the board, boosted by financial shares with Japan closing almost 2% higher. However caution ahead of U.S. retail sales data due later in the session kept the U.S. dollar under pressure.

After setting a record high of $80.20 a barrel, U.S. crude oil prices for October delivery took a bit of a breather, slipping below $80 in the Asian session. But energy firms still advanced with Australia's Santos, Japan's Nippon Oil and China's CNOOC all higher.


Japanese stocks surged with the Nikkei 225Average closing up 2% -- its highest close since Sept 6. -- on a weaker yen, active buying of futures, and gains by exporters such as Sony. Sapporo Holdings finished up almost 8% after at one point climbing 15% to hit the daily limit, with analysts saying investors were likely buying the shares on speculation that a U.S. hedge fund may make a move for the brewery.

South Korea's KOSPI was almost 1% higher, as steel makers such as POSCO approached a record amid expectations for higher prices for their products, while shipbuilders such as Daewoo gained on new orders. But lenders such as Kookmin Bank slumped amid worries about loan exposure to financially troubled small and medium-sized builders, while chip makers such as Samsung Electronics extended a recent drop on earnings worries.

Australia's S&P/ASX 200 Index finished 1.2% higher, as Macquarie Bank led a rally in financial firms after it flagged a 40% rise in first-half profit, while mining firms gained on firmer base metal prices.

The Hang Seng Index closed 1.5% higher, buoyed by strong global markets, as investors piled into local property developers on growing confidence of a U.S. rate cut next week. Shares in Hong Kong's biggest developer, Sun Hung Kai Properties, set their third straight record after the company said it planned to invest HK$33 billion (US$4.2 billion)
over three years to expand its China business.

Singapore's Straits Times Index finished 0.9% higher, led by property stocks such as CapitaLand and City Developments on expectations that a widely-expected cut in U.S. interest rate next week would eventually result in lower mortgage loan rates in Singapore and boost demand for real estate.

The Shanghai Composite Index closed 0.7% higher, but concern about the Chinese government policy remained. Foreign currency-denominated B shares soared on the view that cheaper valuations made them safer than A shares.