Asian markets were mostly higher Monday while the greenback lost ground as investors looked for U.S. President-elect Barack Obama to quickly roll out hefty economic stimulus spending and a revived plan to buy bad bank assets.
Obama is set to take office on Tuesday following a U.S. national holiday on Monday, and many investors have hoped for weeks that he will undertake aggressive action to help pull the economy out of its deep, year-long recession.
Renewed fears that major financial institutions will be forced to write down billions of dollars more in assets and raise significant capital have taken the wind out of a brief revival of risk taking, driving many equity indexes to one-month lows last week. Investors are bracing for more dismal news from companies as quarterly earnings season kicks into high gear, which could deal another blow to the rebound in stocks and emerging market currencies from lows hit late last year.
The euro edged higher against the dollar, up from a one-month low near $1.3025 hit last week. The dollar was up against the yen , getting a lift from the yen's broad retreat. Crude oil prices for March delivery were a touch lower, but still trading about $42 in the Asian session.
Japan's Nikkei 225 Average ended 0.3 percent higher. Toshiba shot up more than 6.4 percent after a newspaper reported the electronics conglomerate had won contracts to build two nuclear power generation units for a project in Texas planned by NRG Energy, estimated to be worth 600 billion-800 billion yen ($6.6 billion-$8.8 billion). But Japan's three major shipping firms including Nippon Yusen fell after a newspaper said the firms are likely to see double-digit falls in profits for this business year, hit by sluggish global transport activity.
Seoul shares finished 1.3 percent higher led by technology issues including LG Display and Hynix Semiconductor on hopes the industry downturn may hit a bottom, and were further helped by a cabinet reshuffle affecting top financial policy makers. Shares in LG Display ended 7.88 percent higher and Hynix Semiconductor jumped 12.8 percent. LG was buoyed by comments from the firm that it expected a recovery in TV panel prices, counterbalancing weaker than expected results after the close on Friday.
Australian stocks closed 1.1 percent higher, driven by miners and gains in coal-to-groceries conglomerate Wesfarmers on a report it was close to refinancing part of its heavy debt burden. Trading was thin ahead of a U.S. market holiday on Monday, and largely followed Wall Street's lead from last Friday. Leading the gains were top miners BHP Billiton and Rio Tinto as well as gold miner Newcrest Mining.
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Hong Kong shares ended 0.6 percent higher, despite weakness in global lender HSBC. HSBC fell 3 percent after U.S. financial institutions such as Bank of America and Citigroup reported huge losses.
Singapore's Straits Times Index pared back gains, but closed 1 percent higher. Shares of Sembcorp Marine fell 3 percent after Credit Suisse downgraded the firm to "underperform" from its previous "neutral" rating.
China's Shanghai Composite Index was up 1.7 percent, reaching a four-week high as blue chips drew strength from optimism that the government would offer additional aid for struggling sectors of the economy. Industrial & Commercial Bank of China, the country's biggest
bank, and China Construction Bank both surged.