By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) -- Asia stocks gained on Wednesday amid
renewed optimism for an agreement on upcoming U.S. tax hikes and
spending cuts, ahead of the conclusion of a meeting at the U.S.
central bank that may see it undertake more asset buying.
Japan's Nikkei Stock Average rose 0.7%, South Korea's Kospi
advanced 0.4% and Australia's S&P/ASX 200 index rose 0.5%.
An unexpectedly strong reading for a gauge of German economic
sentiment helped to lift European stocks on Tuesday, while U.S.
stocks rose for the fifth straight session amid fresh hope for a
deal to avoid billions of dollars of automatic spending cuts and
tax hikes early next year.
"Investor sentiment towards the U.S. fiscal cliff is turning
more positive," said Matthew Sherwood, head of investment market
research at Perpetual Investments. "Investors thought a lack of
public bickering between Republicans and Democrats meant the two
sides are making progress," he said.
The Federal Reserve wraps up its two-day monetary policy meeting
later in the global day and the U.S. central bank may announce
fresh asset purchases.
"While balance sheet expansion represents a dovish shift in [the
Fed's] monetary policy stance and is likely supportive for general
risk sentiment, such a stance is widely expected and the overall
market effect is likely limited should it move in line with our
baseline case, in particular with looming uncertainty over the U.S.
fiscal cliff," said strategists at Barclays Capital.
Technology stocks were generally strong in Japan on Wednesday,
as the dollar held onto the gains that took the currency to around
the ¥82.50 mark on Tuesday.
TDK Corp. (TTDKF) rose 2.6% while Toshiba Corp. (TOSYY) advanced
1.1%.
Canon Inc. (CAJ) shares climbed 2.4% after a Nikkei report that
the firm will cut costs by between 70 billion to 80 billion yen
next year.
Panasonic Corp. (PC) shares rose 2.6% after a separate Nikkei
report that the firm is planning to sell the digital camera
operations of subsidiary Sanyo Electric Co.
Exporting automakers were also seeing some gains, with
Mitsubishi Motors Corp. (MMTOY) up 1.1% and Honda Motor Co. (HMC)
higher by 1%.
Cross-border deal making between Australian and Chinese
companies featured on Wednesday.
Mining BHP Billiton Ltd. (BHP) climbed 1.1% after it said it's
sold its 8.33% interest in the East Browse Joint Venture and 20%
interest in the West Browse Joint Venture, with both gas projects
located offshore Western Australia. The stakes were sold for $1.63
billion cash to a unit of PetroChina Co. (PTR)
(PTR)Rival Rio Tinto Ltd (RIO) climbed 0.5% after announcing
that it will sell its 57.7% stake in the Palabora Mining Company
Ltd. for $373 million to a consortium comprising South African and
Chinese entities led by the Industrial Development Corporation of
South Africa Ltd. and Hebei Iron & Steel Co.
The Korean market was supported by gains for heavyweight Samsung
Electronics Co. (SSNLF) which moved higher by 0.1% in early
trading.
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