Asian stocks start August on bullish note

Indian stocks were almost alone in losing ground, as investors fret about a flood of stock from redemptions in the largest fund

By staff and wire reports

HONG KONG, China -- Asian stocks ended the first day of August trade in a boisterous mood.

Japan closed with a strong showing on good earnings and a bank tieup. But markets in Australia and Hong Kong posted even more impressive runups.

South Korea had the region's largest gains, rising almost 4 percent.

In Japan, the benchmark Nikkei average ended up 0.8 percent at 11,959.33.

Matsushita slips after first loss

Daiwa Bank set the positive tone, shooting up 11.6 percent to 144 yen.

Daiwa, widely viewed as Japan's most troubled large bank, said it planned to consolidate operations with Kinki Osaka Bank Ltd. and Nara Bank, two regional banks.

The move had been expected since mid-July, when Daiwa said it was mulling forming a super-regional bank with its partners.

The world's biggest consumer-electronics company, Matsushita Electric Industrial Co., slipped 0.6 percent to 1,729 yen.

The maker of Panasonic, National and JVC brands announced its first quarterly loss after the end of trade Monday, for the June quarter, and said it expected a loss for the first half of the fiscal year.

Matsushita rival Sony announced a shock 90 percent earnings drop last week. On Wednesday, it recovered from a ratings outlook by agency Moody's to close up 0.8 percent at 6,200 yen.

Solid news on the earnings front from Canon boosted the office-supply company's stock. It rose 4.5 percent to 4,410 yen.

Australia's banks, miners find gains

In Australia, strong economic news and good U.S. overnight gains drove stocks higher.

Sydney's benchmark S&P/ASX 200 index rallied 1.5 percent to 3,374.5 to clock up its fourth straight day of gains and the highest close since July 20.

A stronger Australian dollar also helped spark buying in banking, mining and telecom stocks.

"It is a big rally in terms of the Australian market," said James Hogan at Rothschild Australia Asset Management.

Investors had been growing cautious of late, and are still looking at defensive stocks.

But Hogan said overseas investors stepped in to buy on Wednesday.

June retail sales were stronger than expected in Australia when they came out on Wednesday, showing more domestic resilience to offshore weakness.

ANZ Bank led the banking sector higher, rising 3.3 percent to A$16.10. The bank index rose 2.3 percent.

Resources giant BHP Billiton raced ahead 3.5 percent to A$10.04 on Tuesday's strong fourth-quarter production report.

Australia's largest telecom, Telstra, was the most-active stock. Down 24 percent since a weak earnings report in June, Telstra rose 2.8 percent to A$5.11. The stock seems to have bottomed at A$5.00.

Hong Kong up on HSBC

In New Zealand, the benchmark NZSE-40 Capital dropped 0.3 percent to end at 2,064.04.

But Telecom New Zealand, the market's biggest stock, rose 3 cents to NZ$5.39 as Asia-Pacific telecoms finally enjoyed a spot of sunshine.

Hong Kong's markets had another vibrant showing. The Hang Seng Index gained 1.3 percent to 12,478.74, extending Tuesday's 1.9 percent rise.

But Hong Kong remains one of the worst markets in Asia this year, down 17 percent.

The largest stock, bank HSBC Group, rose 1.4 percent to HK$90.25, building on a 1.7 percent climb on Tuesday, after a good forecast for competitor Barclays.

HSBC had dropped 10 percent in the last three months, as economies around the world slowed.

China's B shares reversed stemmed the tide of recent losses, with Shanghai's B share index rising 2.3 percent and Shenzhen's, 3.0 percent.

Seoul's benchmark Kospi shredded other regional players, rising 3.9 percent to 562.79.

There are fresh funds for troubled Hynix Semiconductor, the world's third-largest memory chip maker.

Hynix rose 15 percent, the daily limit, to 1,580 won. Its main creditor, state-backed Korea Exchange Bank, rose 8.9 percent to 2,675 won.

Hynix rival Samsung Electronics, the world memory-chip No. 1, rose 4.5 percent to 198,000 won. Samsung, Korea's biggest stock, has showed persistent gains lately.

Tuesday's decision by NEC to stop making memory chips gives its prospects an extra boost.

In Taiwan, the benchmark Taiex rose 0.04 percent to 4,354.52.

After the bell Tuesday, United Microelectronics Corp. announced a larger than expected loss. But Taipei's second-biggest stock rose 0.5 percent to T$39.10.

Overseas investors have been buying the stock, traders say. Rival and world contract-chip No. 1 Taiwan Semiconductor Manufacturing Corp. rose even faster, putting on 3.8 percent to T$68.50.

In Singapore, the Straits Times index was trading up 0.6 percent at 1,676.24.

A day after setting a three-week high, banking group DBS was trading flat at S$13.50. The stock rallied after it ditched a bid for a fellow Singapore bank.

In India, the Bombay 30-share index was trading down 0.4 percent at 3,315.51.

With India's largest mutual fund, U.S.-64, reopening for redemptions on Wednesday, investors worry its manager, the Unit Trust of India, will flood the market with stock.

Reuters contributed to this report.