By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) -- Asian markets rebounded Tuesday as a
higher finish on Wall Street helped sentiment a day after most
regional equities suffered a sell-off, with Japanese stocks
extending gains on hopes for further monetary easing under a new
central bank chief.
Mainland Chinese stocks advanced in choppy trading as the
National People's Congress -- the country's parliament -- began its
annual session, although property developers fell further under the
lingering influence of fresh restrictions imposed on the sector
late last week.
The rebound came as outgoing Premier Wen Jiabao kicked off the
annual session of the NPC by announcing an economic growth target
of 7.5% for 2013, in line with expectations.
"China has found buyers today, and while all the talk yesterday
was around property, today's sentiment seems a little more robust,"
said Chris Weston, chief market strategist at IG Markets.
The Shanghai Composite jumped 2.3% in afternoon trade, after
slumping 3.7% on Monday for its worst loss since August 2011. The
benchmark had briefly dipped into the red earlier in the
session.
Hong Kong's Hang Seng Index climbed 0.5%, Japan's Nikkei Stock
Average ended 0.3% higher and South Korea's Kospi gained 0.2%.
The S&P/ASX 200 index rose 1.3% in Sydney, holding on to
most of its gains after the Reserve Bank of Australia left its
policy interest rate unchanged at 3%.
Despite the broad gains, some analysts remained cautious.
"Continued uncertainty surrounding Italian politics and central
bank monetary decisions means price gains would likely be capped,"
said strategists at Credit Agricole, referring to this week's
upcoming meetings at the European Central Bank and the Bank of
England.
U.S. investors on Monday shrugged off the losses in Shanghai,
sending the Dow Jones Industrial Average (DJI) to its
second-highest level on record. Read: Stock gain lifts Dow average
to second-highest level.
Dow Jones Industrial Average futures were up 5 points at 14,121
by mid-afternoon in Hong Kong.
The rebound on mainland bourses was led by financial, resource
and industrial stocks, with Jiangxi Copper Co. (JIXAY) rising 0.9%
and Bank of Communications Co. (BCMXY) adding 0.8%.
"Commentary from China's National People's Congress seems upbeat
and although it is once again targeting gross domestic product
[growth] of 7.5%, the market still expects this is to be a modestly
conservative estimate," said IG Markets' Weston.
But property stocks remained a weak spot, amid fears that the
latest restrictions on the sector may undo a recent recovery in
home prices.
Gemdale Corp. lost 1.1% and Poly Real Estate Group Co. fell 0.9%
in Shanghai, while China Vanke Co. dropped 0.7% in Shenzhen. All
three stocks had plunged by the day's 10% limit on Monday.
In Hong Kong, Chinese banks and local property developers rose
to help offset a 0.3% drop in shares of HSBC Holdings PLC (HBC)
after the heavyweight lender on Monday reported 2012 results that
fell short of expectations.
Japanese shares, which had on Monday defied broad regional
declines, added to their gains on the back of a continued rally in
real estate and financial sectors.
The rise in Tokyo came a day after the government's nominee for
Bank of Japan Gov., Haruhiko Kuroda, made remarks favoring bolder
monetary measures to meet the central bank's recently-adopted
target of achieving a 2% inflation.
Kuroda is expected to succeed incumbent Masaaki Shirakawa, who
will be stepping down on March 19.
Finance Minister Taro Aso said at a press conference Tuesday
that he expects Kuroda to handle monetary policy in line with the
joint pact signed by the BOJ earlier this year, aimed at spurring a
sluggish economy.
Heavyweight stock Fast Retailing Co. (FRCOY) fronted the
advance, jumping 5.5% after reporting a 9.6% increase in sales at
its Uniqlo casual clothing chain in February.
The retail sector climbed in Sydney after data showing industry
sales rose 0.9% on an adjusted basis in January, beating economist
expectations for a 0.4% gain.
Myer Holdings Ltd. gained 2.5%, while David Jones Ltd. advanced
3.5%.
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