ASIA MARKETS: Japan Stocks Surge As Asia Shares Sink

By Sarah Turner, MarketWatch

SYDNEY (MarketWatch) -- Japanese stocks scored their latest rally Monday, rising despite mostly negative performances elsewhere in Asia, as investors bet on Tokyo's deflation-fighting plans and further weakness in the yen.

Japan's Nikkei Stock Average rose 1.1%, South Korea's Kospi traded flat, and Australia's S&P/ASX 200 index declined 0.3%.

The moves came after Wall Street ended with slight gains Friday, helped by upbeat U.S. data on consumer confidence and manufacturing. Read: Stocks end session, week on a high note

The U.S. dollar (USDJPY) gained as well Friday, with the greenback buying Yen93.56 Monday, just off from Yen93.58 yen in late North American trade Friday but well above Thursday's Yen92.63 level.

The softer yen came amid growing confidence that Japan's new government will be able to make ground in curbing deflation. The Nikkei business daily reported Monday, for instance, that an inflation forecast used by bond investors has risen to 1.16%, up from 1% in mid-February.

The financial and real-estate sectors would likely be among the biggest beneficiaries if Japan returns to solid inflation, and property names were particularly strong performers on Monday. Among them, Mitsui Fudosan Co. (8801.TO) climbed 4.2%, Sumitomo Realty & Development Co. (8830.TO) advanced 5.3%, and Mitsubishi Estate Co. (MITEF) surged 8.2%.

Those gains came as a separate Nikkei report said real-estate investment trusts are expected to raise almost three times the amount of capital in the first three months of 2013 compared to in the preceding quarter.

Meanwhile, the lower yen helped boost Japanese blue-chip exporters. Sony Corp. (SNE) climbed 3.7%, Bridgestone Corp. (BRDCF) rose 2.6% and Fujitsu Ltd. (FJTSY) improved by 1.4%.

On the downside in Tokyo, losses late last week for crude-oil futures weighed on the energy sector as Inpex Corp. (IPXHY) lost 0.8%, and JX Holdings Inc. (JXHGF) fell 0.2%.

Friday's strength in the U.S. dollar also worked to pressure prices for metals, as gold ended at its worst level since July last year, while copper futures fell to a three-month low. Read: Gold down a third day, at lowest since mid-July

That move fed into a weak performance for Sydney-listed miners on Monday, with the sector down 2.1%.

Rio Tinto Ltd. (RIO) declined 2.2%, BHP Billiton Ltd. (BHP) -- trading ex-dividend -- slipped 1.4% on an adjusted basis, and Fortescue Metals Group Ltd. (FSUMY) declined 2.8%.

South Korean stocks received some support from an advance for market major Samsung Electronics Inc. (SSNLF), which rose 1.2% after a U.S. court on Friday issued a ruling that slashed the amount of damages the firm has to pay arch-rival Apple Inc. (AAPL) by around 43% to just under $600 million.

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