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Market Update

Nikkei Soars to 5-Yr Highs; Leads Gains in Asia

Japanese stocks soared close to five-year highs on Tuesday, leading other bourses in the region higher as overnight gains on Wall Street spurred investor confidence.

The Nikkei traded above the 14,000-mark for the first time since June 2008 to finish up 3.6% as investors returned to the market after a holiday yesterday.

Among other indexes, the Shanghai Composite added 0.2%, the Hang Seng gained 0.6%. The Sensex rose 1.2%.

Australia’s S&P/All Ordinaries pared some early losses after the country’s central bank, in a surprise move, slashed its benchmark interest rate. The index ended 0.2% lower, up from a loss of 0.5% logged before the policy decision.

Overnight action at Wall Street continued to be supportive. The S&P 500 closed at a new record high, treading above 1,600 supported by gains in financial stocks.

Meanwhile, traders were also hopeful of further supportive monetary policies from the European Central Bank. Addressing an audience in Rome, president Mario Draghi said the bank would monitor economic data closely and would slash interest rates further if required.

Stocks on the move

Exporters in Tokyo scored robust gains as the yen hovered near 100-mark against the dollar. Among top scorers, Sony Corp. bounced over 6%, Tokyo Electron jumped nearly 7% while Toyota Motor Corp. rose 4.9% ahead of its earnings results tomorrow.

Mitsubishi Heavy Industries gained nearly 5% while Itochu Corp. added 3.5% after reports said the two companies along with France's GDF Suez would build a nuclear power plant in Turkey.

Shipping companies and power utilities were among other front-liners -- Kawasaki Kishen K.K. added 3.1% while Mitsui O.S.K. Lines climbed around 3%. Kansai Electric Power rose 4.7% and Tokyo Electric Power gained 5.3%.

Financials, realty players, retailers and resources stocks supported the broad market gains.

Mumbai's 30-share benchmark Sensex index also climbed higher with automakers, banks and metal plays supporting.

Hero MotoCorp was the top gainer -- up 3.7%, followed by Bharti Airtel (+3.1%), ITC (+2.7%) and Tata Motors (+2.6%).

Among banks, HDFC Bank rose 1.8%, ICICI Bank climbed 1.7% while SBI added 1.4%.

Drugmaker GlaxoSmithKline Pharma added 2.6% after reporting higher first quarter profit. Cipla added 1% but Dr. Reddys Lab ended flat.

In individual stocks, Den Networks fell more than 2% paring earlier gains after reports said Goldman Sachs invested $110 million in the cable television and internet services provider.

Coal India lost 1.7% as the government prepared to divest 10% equity in the company.

In Hong Kong, metal players moved higher. Angang Steel added 5.7% while Aluminum Corp. of China rose 5.2%.

On the earnings front, SJM Holdings jumped 3% after posting higher first-quarter profit. Other casino players were also mostly higher. Galaxy Entertainment added over 2%, Wynn Macau Ltd. edged up climbed 2.1% while MGM China Holdings improved 1.7%.

Financials too bounced back in the green, moving off early lows. ICBC added 0.7%, China Construction Bank gained 0.5% and Agricultural Bank of China rose 0.8%.

But financials in Sydney ended weak despite the surprise rate-cut announced by the RBA. NAB, Westpac Banking and ANZ all lost more than 1.5% each.

Miners were, however, on the upside, offsetting some of these losses. Index leader BHP Billiton and close competitor Rio Tinto rose more than 2% each while gold miner Newcrest Mining surged around 7%.