Asian stocks shake off Fed and rise

By staff and wire reports

HONG KONG, China -- Most Asian markets on Wednesday shook off signs of a faltering performance in the United States after the Fed cut rates again.

Tokyo stocks moved ahead with strong gains, as investors grew optimistic about revitalization efforts at home.

South Korean shares rose more than a percentage point. Singapore clawed back from early losses to move into the black in afternoon trade.

But Hong Kong's U.S.-driven market slipped to a 28-month low.

Its pegged currency and linked interest rates have pushed it south, abetted by a slumping property market and a dip in prospects for its China cell-phone plays.

Australia and New Zealand also closed on losses. Taiwan stubbed its toe again.

Japan turns to revamp story at home

The U.S. Federal Reserve said overnight Tuesday it would cut rates by a quarter of a percentage point. That's the seventh rate trim this year, leaving the fed funds rate at 3.50 percent.

Markets had factored that in. But U.S. stocks still sold on the news of the cut, with investors worried about the prospects of a future trim amid a gloomy outlook.

All 30 Dow stocks ended lower, with the Dow Jones industrial average falling 1.4 percent. Nasdaq dropped 2.7 percent.

Markets in Tokyo absorbed the move, then moved stronger as investors focused on good news with Japan's attempts to restructure.

The benchmark Nikkei average rose 1.03 percent to end at 11,396.43.

The broader Topix rose 0.58 percent to 1,165.54.

Construction and real-estate companies rose on strength stemming from government urban-revitalization plans.

Mitsubishi Real Estate Co. rose 4.43 percent to 1,390 yen.

Tokyotokeiba Co., a horse racing track operator with large landholdings in the Tokyo Bay area, shot up 10.6 percent to 157 yen.

Banks benefit from watchdog's steps

Banks were also moving on optimism reforms might go ahead. The Financial Services Agency is working on plans to stem a potential flood of stock as banks unload their crossholdings.

Mizuho Holdings Inc., the world's largest bank by assets, rose 6.8 percent to 502,000 yen.

UFJ Holdings Inc. put on 2.89 percent to 640,000 yen. The FSA said it would inspect UFJ in early September.

Techs weren't the focus for once. But leading cell-phone operator, NTT DoCoMo Inc., fell 1.23 percent to 1.6 million yen, a fresh year-to-date closing low.

It is Japan's largest stock by market cap.

Circuit maker Kyocera Corp. fell 0.79 percent to 7,750 yen. The Nihon Keizai Shimbun said its group operating profit would total about 100 billion yen for the next business year, down from a forecast of 170 billion yen.

Kyocera would not confirm the figure but said it is working on a new forecast.

Nomura Securities Co., Japan's largest broker, rose 5.1 percent to 2,280 yen.

Its affiliate, think tank Nomura Research Institute Ltd., is prepping one of this year's largest and highest-profile stock offerings in Japan. NRI, which gets 80 percent of sales from computer- systems work, will go public on October 2.

Seoul rises too

In Seoul, the benchmark Kospi was another gainer, rising 1.1 percent to close at 574.87.

Samsung Electronics, the market's biggest stock, rose 3.5 percent to 192,500 won. Overseas investors have been buying the stock.

Rival and troubled chipmaker Hynix Semiconductor rose 4 percent to 1,630 won. Creditors said they were leaning toward a debt-equity swap to help it get out of trouble.

Korean officials also promise that year-long negotiations to sell brokerage Hyundai Securities to American International Group will conclude with an announcement Thursday.

Hong Kong reels again

In Hong Kong, the dim prospects for U.S. growth sent the benchmark Hang Seng reeling.

It ended down 2.2 percent at 11,188.57, Asia's worst performing index this year having the largest losses on Wednesday.

It was the Hang Seng's worst close since April 1999.

China Mobile, the second largest stock in Hong Kong, dropped 7.55 percent to HK$25.10, it's lowest close since October 1999.

Investors are still fretting after it reported lower-than-expected earnings growth of 58 percent last week.

Rival and China No. 2 China Unicom lost 6.34 percent to HK$9.60 in sympathy.

Property giant Cheung Kong Holdings slumped 1.46 percent to close at HK$67.50. It will report first half earnings after the market closes on Thursday.

Li & Fung rose 2.07 percent to HK$9.85, after plunging more than 17 percent on Tuesday on its earnings. Hong Kong's largest trading company, it gets most of its sales in the United States.

In Taiwan, the benchmark Taiex lost 1.7 percent to 4,487.52. Nasdaq's fall depressed Taipei's dominant electronics stocks.

The electronics index lost 3.3 percent.

World contract chip No. 1 Taiwan Semiconductor Manufacturing Co. was the most active stock, falling the daily 7 percent limit to T$62.00.

Rival United Microelectronics Corp. lost 1.8 percent to T$38.00.

In Singapore, the Straits Times index broke back from early losses. It closed 0.1 percent up at 1,632.40.

Commonwealth off after earnings in Sydney

In Sydney, the benchmark S&P/ASX 200 fell 0.3 percent to 3,311.0. It's now essentially flat for August.

The stronger Aussie dollar might start to pressure mining stocks, which depend heavily on exports. They are already suffering from the slowdown in Japan.

The market's biggest miner, Anglo-Australian listing BHP Billiton, fell 1.7 percent to A$9.02.

Another Anglo-Australian miner, Rio Tinto, slipped 0.5 percent to A$31.91.

Rupert Murdoch's media giant News Corp., which gets about 70 percent of profits in the United States, fell 1.3 percent to A$16.85.

It is Australia's largest stock and often drives the index.

Another drag came from Commonwealth Bank of Australia. CBA fell 2.5 percent to A$30.80, after coming out with earnings.

Its full-year profit was at the low end of expectations, and Australia's second-biggest bank warned that the year ahead could see profit margins shrink.

In New Zealand, the benchmark NZSE-40 capital index ended down 0.8 percent at 2,020.68. That was its lowest close since March 5.

Telecom New Zealand, the biggest stock in Wellington, fell 9 cents to NZ$5.01.

Reuters contributed to this report.