ASIA MARKETS: Japanese Stocks Lead Rally In Asian Markets

By Chao Deng

Stocks in Japan surged for a second time this week while Hong Kong emerged as one of the best-performing major Asian indexes so far this month, as bargain hunters returned despite a recent bout of volatility in global markets.

The Nikkei Stock Average led the region with a 2.4% gain after the latest read on Japanese exports, which rose 6.9% from a year earlier in September, helped by a weaker yen and a surge in output among suppliers of components for Apple's new smartphones. Still, Japan's trade deficit edged up 1.6% to Yen958.3 billion ($8.96 billion) from a year earlier, the first increase in three months.

Stocks in Japan have had an especially rough run lately, falling over 10% from a late-September peak and seesawing earlier this week. On Tuesday, the Nikkei lost 2%.

The Nikkei tends to trade inversely to the U.S. dollar, whose strength against the Japanese yen has waned in October, backtracking on gains earlier this year. On Wednesday, the greenback (USDJPY) was little changed from Yen107 late Tuesday in New York.

The Hang Seng Index was emerging as the stronger performer in the region. The index has achieved a month-to-date gain of 2% despite protests that have hurt the city's retailers and other businesses.

The index was up 1.2% Wednesday, after the government and pro-democracy student leaders held official talks for the first time Tuesday. There was no agreement, however, over how the city's chief executive should be elected.

Elsewhere, Australia's S&P/ASX 200 and Korea's Kospi were each up 1.1%.

"Analysts are divided over the spur for the rallies. Some point to the potential for European stimulus, while others are looking to steady growth numbers from China," said Michael McCarthy, chief market strategist at CMC Markets.

Overnight, U.S. stocks rallied on the back of upbeat technology earnings and reports that the European Central Bank was considering buying corporate bonds.

BHP Billiton (BHP) was up 1.5% after the firm reported strong petroleum and metallurgical coal production and solid iron-ore output figures for the September quarter.

Hyundai Motor was down 4.2% ahead of its third-quarter report. The firm is estimated to post a net profit of 1.87 trillion won ($1.76 billion), down 17% from a year earlier, while sales likely fell 12% to 20.57 trillion won, according to a Wall Street Journal poll.

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