Asian stocks ended mixed on Wednesday, with Chinese shares rallying sharply on easing concerns about the outlook for the world's second-largest economy, while Japanese shares drifted lower on a firmer yen and Australian shares fell notably, dragged down by banks. The markets elsewhere showed muted performance amid renewed geopolitical worries and growing concerns about stalling growth in the euro area.
Chinese shares rose the most in about seven weeks, led by brokerages on speculation the planned exchange link between Shanghai and Hong Kong, set to start next month, will boost stocks. The benchmark Shanghai Composite Index rallied 1.47 percent to 2,343.57, its highest close since March 2013. Hong Kong's Hang Seng index gained 0.35 percent to finish at 23,921.61
Tokyo stocks drifted lower as trading resumed after a public holiday. The benchmark Nikkei average fell 0.24 percent to 16,167.45, slipping further from a seven-year high hit last week, while the broader Topix index of all first-section shares shed 0.35 percent. The yen strengthened against other major currencies amid escalating conflict in the Middle East and on reports that Prime Minister Shinzo Abe wants to be "careful" about the recent yen weakness.
SoftBank Corp. tumbled 3.5 percent after Alibaba Group Holding shares fell for a second straight day in New York. Aeon Co. dropped 2.7 percent on a report it will make Daiei into a full-owned subsidiary. Shares of supermarket chain operator Daiei Inc., meanwhile, soared 17.4 percent.
Machinery manufacturer Amada Co. rose 1.3 percent on expectations it will report better-than-expected financial results for the six months through September 30. Starbucks Coffee Japan climbed 4.4 percent on news that its U.S.-based parent Starbucks Corp. will acquire the remaining 60.5 percent stake it currently doesn't own in its Japanese unit through a two-step tender offer process.
In economic news, Japan's manufacturing sector continued to grow in September, albeit at a slower pace, preliminary survey results from Markit Economics revealed with a PMI score of 51.7. That's down from 52.2 in August, although it remains above 50 that separates expansion from contraction. "September data indicated further stable growth for Japanese manufacturers, with output rising to the strongest degree in six months and new orders remaining in modest growth territory," said Amy Brownbill, Economist at Markit.
Australian shares fell notably after U.S. stocks fell for a third straight session overnight following the U.S.-led airstrikes against the Islamic State group in Syria. The benchmark S&P/ASX 200 index slid 0.7 percent to finish at 5,375.8 after climbing 1 percent the day before. Banks led the decliners, with ANZ, Westpac, Commonwealth and NAB closing down between 0.9 percent and 1.4 percent.
Miners closed mixed, with BHP falling 0.7 percent, while Rio Tinto rose 0.9 percent and Fortescue Metals Group added 0.3 percent. The Bureau of Resources and Energy Economics said in a quarterly report that it expects the iron ore price will average around $US94 a ton for the rest of 2014, significantly lower than the $US105 a ton forecast in June.
On the economic front, the Australian economy continued to expand in July, the Conference Board's latest leading index revealed - gaining 0.5 percent following a 0.4 percent increase in June. At the same time, the coincident index added 0.1 percent, slowing from the 0.2 percent gain in the previous month.
Seoul shares rose modestly despite concerns over slowing growth in China and Europe. The benchmark Kospi index closed up 0.33 percent at 2,035.64 after hitting a two-month lower earlier in the day. While Hyundai Motor rose 0.3 percent on bargain hunting, tech giant Samsung Electronics lost a percent.
New Zealand shares advanced, with Nuplex Industries pacing the gainers after the chemicals manufacturer confirmed it is in discussions to sell two of its Australasian businesses to CHAMP Private Equity. While shares of the company soared 6.6 percent to a three-month high, the benchmark NZX-50 index closed up 0.32 percent at 5,258.17. Units in Fonterra Shareholders' Fund ended flat after Fonterra Cooperative Group decided to reduce its forecast milk price payout to the country's farmers.
In economic releases, New Zealand's trade deficit narrowed to NZ$472 million ($381 million) in August versus forecasts for a deficit of NZ$1.125 billion following the downwardly revised NZ$724 billion shortfall in July, data from Statistics New Zealand revealed.
Elsewhere, India's Sensex was down half a percent, Singapore's Straits Times index was declining 0.3 percent and Indonesia's Jakarta Composite index was down 0.1 percent, while the Taiwan Weighted average closed 0.2 percent higher.
U.S. stocks declined for the third straight session overnight, as a move from the U.S. Treasury to curb "tax inversion" deals and the airstrikes at ISIS targets in Raqqa and other Syrian cities sent investors scrambling for safe-haven assets. Relatively strong manufacturing and services sector reports bolstered the outlook for third-quarter economic growth, limiting the downside to some extent. The Dow fell 0.7 percent, the tech-heavy Nasdaq slid 0.4 percent and the S&P 500 shed 0.6 percent.
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Market Analysis
December 26, 2025 08:42 ET Third quarter economic growth data from some major economies including the U.S. were the main news in this holiday shortened week. GDP growth and industrial production data from the U.S. helped to boost morale, while the consumer confidence survey results were less upbeat. In Europe, the quarterly economic growth data from the U.K. drew attention, while the minutes of the Australian central bank’s latest policy session was in focus in Asia.