HONG KONG - Asian markets mostly rose on Wednesday following a lead from Wall Street and Europe and amid rising hopes that central banks are poised to act to boost economic growth.
But the euro weakened before a European Central Bank meeting Thursday as traders waited to see if the bank would back a deal to help the eurozone, and oil slipped back after rising in the United States on Iranian sabre-rattling.
Tokyo closed up 0.41 per cent, or 37.58 points, at 9,104.17, its highest finish in about two months, while Sydney was up 1.09 per cent, or 45.0 points, to end at 4,172.2, led by mining and resources stocks.
Seoul finished 0.35 per cent, or 6.63 points, higher at 1,874.45. Hong Kong ended 0.13 per cent, or 25.78 points, lower to close at 19,709.75, with the fall driven by profit-taking after recent gains.
Shanghai was flat, edging down 0.08 per cent, or 1.87 points, to close at 2,227.32 as traders took to the sidelines before next week's release of key economic data for June.
Investors are pinning their hopes on a new round of stimulus measures, known as quantitative easing, from the US Federal Reserve, after weak manufacturing data this week added to concerns about the world's biggest economy.
They are looking to Friday when the US government releases its highly anticipated June job growth and unemployment numbers, with the data expected to encourage the Fed to implement more policy easing, dealers said.
Eurozone data, which showed unemployment at a euro-era high of 11.1 per cent and weak manufacturing activity, has raised hopes that the ECB will cut its rate from the current record low of 1.0 per cent to stem the bloc's debt crisis.
"Macro factors are the market movers right now, with everyone expecting more rate cuts and currency printing," said CLSA equity strategist Nicholas Smith.
Daniel Brdanovic, HSBC New Zealand chief manager, told Dow Jones Newswires that markets were expecting the ECB to trim rates but the bank's statement would also be closely watched.
"Markets will be looking to see whether the ECB comes out to support what the European leaders came out with last week," he said.
European leaders agreed at a key summit in Brussels last week to use emergency funds to recapitalise ailing banks directly. They also agreed to contribute US$150 billion to boost growth.
US stocks were boosted on Tuesday by a report showing strong factory orders for May and robust June sales from leading American automakers.
In a trading session that ended early before the July 4 Independence Day holiday, the Dow Jones Industrial Average was up 0.56 per cent, the S&P added 0.62 per cent, while the tech-rich Nasdaq put on 0.84 per cent.
In early European trade Wednesday, the euro bought US$1.2582 and 100.41 yen, against US$1.2607 and 100.64 yen in US trade Tuesday. The dollar stood at 79.78 yen, from 79.83 yen in New York.
Oil prices slipped following a strong rally in the United States after Iran test-fired missiles and Iranian lawmakers backed a draft bill calling for the key Strait of Hormuz to be closed to oil tankers in retaliation for an EU oil embargo.
In afternoon Asian trade, New York's main contract, light sweet crude for delivery in August fell 55 cents to US$87.11 (S$110.10) a barrel and Brent North Sea crude for August delivery shed 61 cents to $100.07.
Gold was at US$1,616.50 an ounce at 1055 GMT, compared with US$1,609.00 an ounce late Tuesday.
In other markets
Taipei edged up 0.06 per cent, or 4.23 points, to 7,422.59.
Hon Hai Precision rose 1.66 per cent to Tw$92.0 while smartphone maker HTC was 0.51 per cent higher at Tw$397.0.
Wellington was up 1.13 per cent, or 38.48 points, to close at 3,483.12.
Telecom Corp. was up 2.7 per cent at NZ$2.495, Fletcher Building rose 1.0 per cent to NZ$6.20 and Chorus gained 0.2 per cent to NZ$3.20.
Manila was down 0.20 per cent, or 10.98 points, at 5,354.72.
Philippine Long Distance Telephone fell 0.36 per cent to 2,750 pesos and Metropolitan Bank shed 1.59 per cent to 95.90 pesos.
Singapore was up 0.12 per cent, or 3.44 points, at 2,948.77.
Singapore Telecommunications gained 0.91 per cent to S$3.34 while Wilmar International fell 1.34 per cent to S$3.69.
Jakarta rose 0.64 per cent, or 26.02 points, to 4,075.91.
Aneka Tambang rose 3.65 per cent to 1,420 rupiah, Astra Agro Lestari gained 5.69 per cent to 22,300 rupiah and Indofood Sukses Makmur rose 1.52 per cent to 5,000 rupiah.
Bangkok fell 0.33 per cent, or 3.92 points, to 1,194.15.
Banpu was unchanged at 468.00 baht, while PTT gained 0.90 per cent to 336.00 baht.
Kuala Lumpur was up 0.37 per cent, or 6.01 points, at 1,613.75.
Kuala Lumpur Kepong gained 3.0 per cent to 23.90 ringgit, AirAsia added 2.8 per cent to 3.70 ringgit while YTL Corp lost 1.0 per cent to 2.00 ringgit.
Mumbai rose 0.21 per cent, or 37.10 points, to 17,462.81.
Private steel maker Jindal Steel rose 3.37 per cent to 446.3 rupees while Sterlite Industries, the local arm of global resources group Vedanta, gained 5.27 per cent to 110.9.