By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) -- Most Asian markets rallied Tuesday on
strong cues from Wall Street and hopes for looser monetary
conditions at global central banks, with Australian stocks ending
at their highest in nearly five years as banks jumped after an
upbeat earnings report.
But Japanese blue-chip shares declined as the yen strengthened
and as Fanuc Ltd. and Honda Motor Co. skidded on disappointing
earnings, even as the Nikkei Stock Average posted a double-digit
percentage gain in April.
In Sydney, the S&P/ASX 200 rose 1.3% to end at 5,191.20, its
highest closing level since June 30, 2008. The market, and banks in
particular, drew support from better-than-expected results from
Australia & New Zealand Banking Group Ltd.
"In an environment where sentiment remains positive, but with an
undercurrent of caution, [and] earnings growth is modest ...
investors are likely to continue their focus on capital management
and reward companies that return capital to investors," Perpetual
head of investment market research Matt Sherwood.
Meanwhile, Hong Kong's Hang Seng Index climbed 0.7%, South
Korea's Kospi added 1.2%, and Taiwan's Taiex gained 0.8%, after the
S&P 500 (SPX) finished at a record level on Monday.
Mainland Chinese markets remained shut for a holiday.
The gains for Asia came ahead of this week's monetary-policy
decisions at the Federal Reserve and the European Central Bank,
with the latter widely expected to cut interest rates by a quarter
percentage point.
Stock performance in Tokyo was mixed, meanwhile, as investors
returned from Monday's holiday, with some front-line companies
retreating as the U.S. dollar (USDJPY) dropped under 98 yen, after
failing to breach the Yen100 milestone recently. On Friday, the
dollar had straddled Yen99, but slipped to Yen98.5 by the end of
the session.
The Nikkei Average , a benchmark of 225 top stocks including
many key exporters, fell 0.2% after briefly turning positive. The
broader Topix index of all Tokyo-traded large-capitalization
issues, gained 0.3%.
The Nikkei rose 11.8% in April, while the Topix climbed 12.6%.
The performance beat other regional benchmarks with a huge margin
during the month, when the S&P/ASX 200 rose 4.5%, the Taiex
gained 2.2%, the Hang Seng Index added 2% and the Shanghai
Composite ended flat, while the Kospi fell 2%.
In Tokyo trading Tuesday, shares of Canon Inc. (CAJ) dropped
1.8%, and Sony Corp. (SNE) shed 1.1% amid the yen's strength.
Honda Motor Co. (HMC) slid 3.4% after the company's earnings
forecasts for the current fiscal year fell short of estimates.
Industrial-automation major Fanuc (FANUY) slumped 5.6% after the
company's disappointing earnings report.
The Nikkei Average's drop in Tokyo also followed official data
released ahead of the open, showing industrial production rose 0.2%
in March, half of what analysts had anticipated.
Shares of major retail firms broadly advanced, however, after
March sales at large-scale retailers climbed 2.4% in March from the
year-ago period.
Shares of convenience-store chain Seven & I Holdings Co.
(SVNDY) gained 1.1%, while rival FamilyMart Co. (FYRTY) rose
1.7%.
In Sydney, Australia & New Zealand Banking Group (ANZBY)
jumped 5.8% after posting a 10% gain in cash profit that beat
expectations.
The result helped lift other financials as well, with National
Australia Bank Ltd. (NABZY) climbing 2.8%, and Commonwealth Bank of
Australia (CBAUY) rising 2.6%.
In Hong Kong, the rally was spread across most sectors. Among
the notable gainers, fashion retailer Esprit Holdings Ltd. (ESPGY)
climbed 3.4%, China Life Insurance Co. (LFC) added 1.2%, and snack
maker Want Want China Holdings Ltd. (WWNTF) rose 0.5%.
On the downside, some casino stocks retreated after media
reports Beijing is sending an official with a "tough cop"
reputation to be its top liaison in Macau amid efforts to tackle
corruption.
Shares of Sands China Ltd. (SCHYY) dropped 3.8%, while Galaxy
Entertainment Group Ltd. (0027.HK) shed 0.6%.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires