Asian markets mostly higher but Europe weighs

HONG KONG—Asian markets mostly rose on Wednesday, extending the previous day’s rally thanks to upbeat US and German data as well as successful bond auctions in Spain and Greece.

However, eurozone fears continued to cast a shadow while financial plays were weighed by disappointing earnings from banking giant Citi.

Tokyo rose 0.99 percent, or 84.18 points, at 8,550.58, while Sydney and Seoul both ended flat. Sydney’s benchmark index nudged up 2.3 points to 4,217.9 while Seoul dipped 0.35 points to 1,892.39.

Hong Kong was 0.30 percent, or 59.17 points, higher at 19,686.92 while Shanghai, which surged more than four percent on Tuesday, shed 1.39 percent, or 32.00 points, to close at 2,266.38.

The advances follow Tuesday’s impressive showing after China said economic growth in the final quarter of 2011 was bigger than expected.

And confidence was given a lift after investors bought up debt from Madrid and Athens just days after Standard & Poor’s downgraded nine of the region’s economies as well as the bailout fund set up to help stricken nations.

Spain’s borrowing costs plummeted in an auction of 12- and 16-month paper, allowing it to raise 4.88 billion euros with demand outstripping supply by more than three times.

And Greece said demand outstripped supply three times as it raised 1.625 billion euros in three-month debt – above the original target of 1.25 billion euros – as the rate eased to 4.64 percent from 4.68 percent.

Buyers were able to take on a little more risk since the European Central Bank loaned nearly half a trillion euros at a rock-bottom rate to the region’s banks last month.

In Germany, the ZEW think-tank’s expectations index showed that investor confidence has risen sharply in recent weeks, suggesting that Europe’s top economy remains resilient to the eurozone crisis.

And in the United States, the Federal Reserve’s Empire State index of manufacturing activity in New York also showed a pick-up in January that widely topped expectations.

The positive news lifted Wall Street, where the Dow gained 0.48 percent, the S&P 500 added 0.36 percent and the Nasdaq was 0.64 percent higher.

However, despite the bond sales, Athens’ struggle to hammer out a deal with creditors to slash its liabilities continues to worry markets.

“Given that the issues about private sector involvement in Greek debt writedowns remains unsolved, risk of a disorderly default of Greece will likely curb the market rallies,” Credit Agricole strategist Kintai Cheung said in a note.

Financial stocks also fell after Citi said in New York that fourth-quarter profit fell to $1.2 billion, from $1.3 billion in the same period in 2010, while full-year earnings were a lower-than-expected $11.3 billion.

European markets were little changed in early trade Wednesday with London’s benchmark FTSE 100 index dipping 0.15 percent, the Paris CAC 40 adding 0.15 percent and Frankfurt’s DAX 30 edging down 0.04 percent.

On currency markets, the euro fetched $1.2828, compared with $1.2737 late Tuesday in New York while it was at 98.50 yen from 97.84 yen.

The dollar was at 76.79, compared with 76.82 yen.

New York’s main oil contract, light sweet crude for delivery in February, gained 36 cents to $101.54 per barrel and Brent North Sea crude for March delivery was up 11 cents to $112.06.

Gold was at $1,655.60 an ounce at 1050 GMT, against $1,662.40 late Tuesday.

In other markets:

— Taipei rose 0.17 percent, or 12.61 points, to 7,233.69.

Hon Hai rose 0.8 percent to Tw$87.7 while HTC fell 1.41 percent to Tw$488.5.

— Kuala Lumpur closed down 0.13 percent, or 1.98 points, at 1,517.38.

Telecommunications company Axiata Group fell 1.22 percent to 4.87 ringgit, while national carmaker Proton lost 0.18 percent to 5.40 ringgit. Petronas Chemicals Group gained 2.0 percent to 6.64 ringgit.

— Mumbai shares slid 0.09 percent, or 14.58 points, to 16,451.47.

Carmaker Maruti Suzuki India rose 10.48 percent to 1,109.95 rupees after announcing a price hike on its vehicles, while energy giant Reliance Industries rose 3.78 percent to 740.35 rupees on a possible share buyback.

— Singapore closed down 0.73 percent, or 20.45 points, to 2,795.40.

SingTel shed 0.64 percent to Sg$3.09 and Oversea-Chinese Banking Corp lost 1.09 percent to Sg$8.16.

— Manila gained 0.75 percent, or 34.86 points, to 4,677.62.

Philippine Long Distance Telephone was up 2.8 percent at 2,826 pesos, conglomerate Alliance Global Group gained 2.7 percent to 11.40 pesos and SM Investments rose 1.0 percent to 6 pesos.

— Indonesian shares closed up 0.3 percent at 3,978.128.

Bank Mandiri gained 2.2 percent at 6,950 rupiah and carmaker Astra rose 0.7 percent at 77,800 rupiah.

— Bangkok slipped 0.46 percent, or 4.90 points, to 1,051.64.

Banpu lost 1.03 percent to 574 baht, while PTT dropped 0.61 percent to 328 baht.

— Wellington rose 0.39 percent, or 12.70 points, to 3,247.50.

Fletcher Building was up 2.0 percent at NZ$6.08 and Telecom gained 3.25 percent to NZ$2.065.