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Market Update

Tokyo Shines in Dull Asian Trade

Japanese equities rallied on Tuesday as the yen touched fresh lows against the dollar after comments by various officials raised hopes of further monetary easing.

Tokyo's benchmark Nikkei Index, which remained shut yesterday for a public holiday, jumped close to a 33-month high as the yen fell sharply against major global currencies. At close, the Nikkei was up 1.9%.

The Japanese currency dropped as low as 94.42 against the greenback, which is its lowest since May 2010. 

These moves were spurred by comments from Haruhiko Kuroda, president of Asian Development Bank.  Kuroda, who is likely to take over as the Bank of Japan governor next month, said he was in favour of an aggressive two-year timeframe to lift inflation to 2%.

Separately, U.S. Treasury official Lael Brainard said his country would support Japan's efforts to end deflation and stimulate growth.

Further adding to the optimism, Japan's economics minister Akira Amira said he would like to see policy steps that would help boost stock prices.

Across other markets, however, trading was listless as bourses in mainland China and Hong Kong remained closed for the Chinese Lunar New Year.

The Sensex gained 0.6% as downbeat industrial production data released today raised hopes the central bank would ease interest rates to spur economic growth in the country. India’s index of industrial production in December dropped 0.6% from a year ago, mainly due to contraction in manufacturing output.

Meanwhile, in Australia a private survey report showed business confidence picked up modestly in January. The S&P/ASX All Ordinaries, however, pared early gains to finish flat.

Stocks on the move

In Tokyo, the yen's slide boosted demand for exporters. Toshiba Corp. rose 3%, Tokyo Electron Ltd. jumped 3.5% and Canon Inc. gained 2.2%.

Auto makers, however, were on the losers' side -- Nissan Motor Co. dropped 3.8% after reporting disappointing quarterly figures. Mazda Motor also declined 4.9%.

But financials scored smart gains. Mizuho Financial Group gained around 4.8% and brokerage house Nomura Holdings rallied over 5%.

Resources and retailers supported with modest gains too. J. Front Retailing Co. gained 5.1% while Fast Retailing added 3.3%. Steelmaker Kobe Steel improved 2.2% while oil giant JFE Holdings rose over 2%.

In Mumbai, stocks shed initial wariness and picked up momentum with oil & gas firm ONGC leading the field, up 3.8% after its third-quarter profits topped Street estimates.

Among others, drug maker Sun Pharma rose 2.8%, Tata Motors climbed 2.3% and Coal India added 1.9%.

n Sydney, Whitehaven Coal surged over 7.8% after two of its coal mine projects received conditional approval from the Australian government.

Mining equipment supplier Bradken Ltd. bounced nearly 11% while Seven Group Holdings added 2.6%.

Among other miners, index leader BHP Billiton slipped 0.3% while Rio Tinto eased 0.6%.

Financials were also mostly lower. NAB and Westpac eased around 0.6% each but Commonwealth Bank added 0.6% ahead of its earnings report tomorrow.