ASIA MARKETS: Japan Extends Rally; Australia Rebounds On Banks

By V. Phani Kumar, MarketWatch

HONG KONG (MarketWatch) -- Most Asian markets rose Wednesday as another record finish for key U.S. equity indexes helped Japanese stocks extend their solid rally from the previous session, while high-dividend yielding shares led a rebound in Australia.

Japan's Nikkei Stock Average climbed 0.8% to 14,297.89, climbing further a day after it soared 3.6% to finish at its highest level since June 2008.

South Korea's Kospi was flat in choppy trade.

Australia's S&P/ASX 200 Index , which ended lower on Tuesday after the Reserve Bank of Australia (RBA) surprised most economists with an interest rate cut, rose 0.5%. The gains came as some banks and telecommunication major Telstra Corp. recovered on the back of their dividend appeal.

"By no means is the yield trade over following yesterday's surprise rate cut by the RBA. And with scope for the RBA to cut rates further, we will continue to see investors forced to seek higher returns, away from bonds and bank deposits and into stocks," said Rivkin Securities analyst Tim Radford.

Shares of Commonwealth Bank of Australia (CBAUY) gained 0.4%, and Australia & New Zealand Banking Group Ltd. (ANZBY) added 0.6%, while Telstra (TLSYY) also climbed 0.6%.

In Tokyo, meanwhile, shares of Softbank Corp. (9984.TO) advanced 3.5% a day after the company unveiled new smartphone models.

Sharp Corp. [(SHCAY) soared 6.6% after the Nikkei newspaper reported two banks had increased the line of credit they set up for the company.

Some exporters also advanced on strong cues from Wall Street, even as the U.S. dollar (USDJPY) slipped against the yen, with Nissan Motor Co. (NSANY) gaining 1.3% and Sony Corp. (SNE) climbing 2.8%, putting its shares up more than 85% for the year to date.

But shares of Toshiba Corp. (TOSYY) tumbled 3.9% after the Nikkei separately reported the company may have missed its operating profit forecast for the fiscal year ended March 31.

Several stocks linked to the resource sector climbed despite a drop in oil and metal prices overnight, as investors looked ahead to monthly Chinese trade data, expected later in the day.

Fortescue Metals Group Ltd. (FSUMY) rose 3.9%, and Rio Tinto Ltd. (RIO) moved 1.2% higher in Sydney.

In Tokyo, energy producer Inpex Corp. (IPXHF) gained 1.6%, and trading house Marubeni Corp. (MARUY) jumped 3.9%.

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