ASIA MARKETS: Asia Stocks Mostly Rise; Tokyo, Shanghai Lag

By Sarah Turner and V. Phani Kumar, MarketWatch

HONG KONG (MarketWatch) -- Most Asian markets ended higher Tuesday after signs of progress in talks to avert the U.S. fiscal cliff lifted stocks on Wall Street overnight, with Australian shares ending at their highest level in more than 16 months.

Japanese stocks ended lower, weighed by power utilities after a government-appointed panel said a nuclear reactor was likely sitting on an active earthquake fault, raising fears that it may be shut down, while Chinese equities declined after strong recent gains.

Australia's S&P/ASX 200 index rose 0.4% to 4,576.0, its best finish since July last year, while South Korea's Kospi advanced 0.4%, Hong Kong's Hang Seng Index added 0.2% and Taiwan's Taiex inched up 0.1%.

Japan's Nikkei Stock Average lost 0.1%, and China's Shanghai Composite Index gave up 0.4% after rising more than 1% Monday following the release of upbeat economic data over the weekend.

"The fact that markets have held up through the [U.S.] fiscal-cliff negotiations and developments in Europe is a positive sign for future gains," said Shane Oliver, head of investment strategy at AMP Capital.

The broad gains came as U.S. stocks rose Monday, shrugging off news of a likely early election in Italy. The Dow Jones Industrial Average (DJI) and the S&P 500 index (SPX) hit their highest levels since the U.S. presidential election in early November.

Major movers

Japanese shares were weighed down by power utilities, after a government-appointed panel of experts found that a nuclear reactor operated by Japan Atomic Power Co. -- in which many of the major utilities hold ownership stakes -- could be sitting on an active earthquake fault.

Shares of Chubu Electric Power Co. (9502.TO) tumbled 4.1% and Kansai Electric Power Co. skidded 4.4%, while Tokyo Electric Power Co. (9501.TO) dropped 1.4%.

Meanwhile, Renesas Electronics Corp. (RNECY) rose 0.3% after the firm confirmed late Monday that it will receive up to 200 billion yen ($2.43 billion) of capital in a deal that will see a government-backed fund emerge with a near-70% stake in the loss-making technology firm.

Sharp Corp. (SHCAF) jumped 6.9% after a Nikkei report that Mitsubishi UFJ Trust and Banking Corp. and Mizuho Trust & Banking Co. will lend the firm  ¥20 billion, while Resona Bank is also mulling a  ¥20 billion loan.

The lenders' parent firms -- Mitsubishi UFJ Financial Group Inc. (MTU) and Resona Holdings Inc. (8308.TO) -- saw their shares fall 0.5% and 0.6%, respectively.

Shares of iron-ore producers advanced after iron-ore prices climbed in the spot market.

In Hong Kong, Citic Pacific Ltd. (CTPCY), which has mining rights in an iron-ore project in Western Australia, climbed 3.9%.

In Sydney, iron-ore extractor Fortescue Metals Group Ltd. (FSUMY) climbed 4%, diversified mining group BHP Billiton Ltd. (BHP) rose 1.3%, and rival Rio Tinto Ltd. (RIO) advanced 0.8%.

On the downside in Hong Kong, Cathay Pacific Airways Ltd. (CPCAY) lost 1.9% after its unions sanctioned industrial action over the Christmas holiday period unless the airline reopened talks with flight attendants over wages.

HSBC Holdings PLC (HBC) gained 0.3% despite news it will pay $1.9 billion to settle a money laundering probe in the U.S.

Shares of Standard Chartered PLC (SNTDF) rose 0.6%, also climbing in spite of news it's agreed to pay $327 million in penalties to U.S. regulators for alleged violations of U.S. sanctions against Iran and other nations. The gains came as news of the settlement lifted uncertainty over the matter.

Property stocks declined in Shanghai, reversing some of their recent gains. Gemdale Corp. dropped 1.7% and Poly Real Estate Group Co. fell 2.1%.

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