Asian stocks advance as China eases

Singapore:  Asian stocks jumped, with the regional index set for its biggest gain in more than a month, after six central banks cut the cost of emergency dollar funding for European banks and China reduced curbs on lending.

Developers Agile Property Holdings Ltd and Evergrande Real Estate Group Ltd gained at least 15 per cent, leading a gauge of Chinese companies listed in Hong Kong to its largest jump since 2008. Hitachi Construction Machinery Co, a Japanese manufacturer that depends on China for about a quarter of sales, jumped 7.3 per cent. BHP Billiton Ltd, the world's biggest mining company, gained 4.1 per cent in Sydney after commodity prices rose.

Enhanced expectation

"The coordinated dollar funding by six central banks helps to ease concerns about a market collapse," said Ryota Sakagami, Tokyo-based chief strategist at SMBC Nikko Securities.

"The reduction of reserve requirements in China will lead to an increase in money supply and that'll push up the stock market in China.

"It also enhances the expectation that China will turn its policy stance toward monetary easing from now on."

The MSCI Asia Pacific Index rose 3 per cent to 116.97 in Tokyo, headed for its largest gain since October 27.

The index, priced in dollars, fell during normal trading on Wednesday before turning positive overnight as the joint action by central banks spurred gains in the Japanese yen and the Australian dollar, inflating the value of stocks denominated in those currencies.

Hong Kong's Hang Seng Index jumped 5.6 per cent, its second-biggest gain since April 2009, while China's Shanghai Stock Exchange Composite Index increased 2.3 per cent. Japan's Nikkei 225 Stock Average rose 1.9 per cent. Australia's S&P/ASX 200 index gained 2.6 per cent. South Korea's Kospi Index advanced 3.7 per cent.