Asian shares ended mostly higher on Monday after G8 leaders pledged to combat financial turmoil, although opinions remain divided among leaders over how to respond to the eurozone crisis. G8 leaders said they want debt-stricken Greece to stay in the eurozone and emphasized growth as well as fiscal discipline to deal with the financial crisis, sparking a slight rebound in investor risk appetite following recent steep losses.
But gains were limited as investors adopted a cautious approach ahead of an informal European summit in Brussels this week, where members leaders are expected to find ways to insulate the eurozone from the Greek exit.
Spain also remained on the radar of investors after the nation's Budget Ministry said late Friday that it has revised its budget deficit estimates for last year to 8.9 percent, worse than the 8.5 percent forecast at the beginning of the year, as a result of higher debt reported by several regional governments.
Japanese shares rebounded from Friday's steep fall, with the benchmark Nikkei gaining a modest 0.3 percent on bargain hunting after leaders of the powerful G-8 countries stressed that bolstering economic growth and job creation was critical to the global economic recovery. The broader Topix index, however, ended 0.1 percent lower at 725.15, a fresh low for the year.
Insurers saw some fresh buying as several insurance companies announced earnings results after Friday's market close. Tokio Marine Holdings rose 1.4 percent, Sony Financial Holdings added 2.6 percent and Daiichi Sankyo gained 2.8 percent. Heavyweight Fast Retailing gained 2.6 percent and Fanuc added 1.5 percent on bargain hunting, while Panasonic lost 1.9 percent on a brokerage downgrade.
China's Shanghai Composite index edged up 0.2 percent, while Hong Kong's Hang Seng index slipped 0.2 percent. Over the weekend, Chinese Premier Wen Jiabao vowed proactive policies to prevent a rapid economic slowdown, spurring speculation the government is open for more aggressive easing measures to boost growth in the world's second-largest economy.
"No matter the fiscal policy or the monetary policy, we cannot afford to wait and see and miss the right timing," We must implement the policies in a timely manner if we believe they're the right ones," he said.
Australian shares closed firmly in the green after China, Australia's biggest trading partner, pledged to boost its economy. The benchmark S&P/ASX 200 index finished up 0.7 percent, while the broader All Ordinaries index added 0.6 percent. Miners paced the gainers, with BHP Billiton climbing 2 percent on speculation it may start a new share buy-back.
Rio Tinto rose 1.4 percent after chief executive officer Tom Albanese indicated the company may delay or even push back iron ore expansion plans once the company reaches its target of 353 million metric tons a year production capacity. Smaller rival Fortescue gained 1.5 percent, while gold miner Newcrest ended 1.9 percent higher.
Financials also ended on a firm note, with the big four banks gaining between 0.4 percent and 1.2 percent Investment bank Macquarie Group edged up 0.4 percent, but insurer QBE lost 1.3 percent.
Leighton Holdings climbed 2.9 percent after Chairman Stephen Johns said that the company should never have established a joint venture with the Al Habtoor Group in the Middle East. In the energy sector, Santos rose 0.3 percent and Oil Search added 2 percent, but Woodside ended unchanged.
South Korea's Kospi average added 0.9 percent, as investors hunted for bargains in large-cap tech stocks and automakers following a sell-off in the previous session. Heavyweight Samsung Electronics rallied 3.7 percent, snapping a four-session losing streak, while Hyundai Motor climbed 3.5 percent and its affiliate Kia Motor jumped 3.8 percent.
Shares of polysilicon maker OCI tumbled 4.4 percent following its announcement that it would delay expansion plans due to Europe's debt crisis.
New Zealand shares fell modestly, as investors awaited earnings from companies such as Fisher & Paykel Appliances for directional cues. The benchmark NZX-50 index slipped 0.2 percent. F&P Appliances, the whiteware maker with sales in the U.S. and Europe, fell 1.8 percent ahead of its annual results on May 24, while Guinness Peat Group lost 2.1 percent before its annual meeting this week.
Carpet maker tumbled 4.6 percent and rural services firm PGG Wrightson shed 3 percent, while transport company Mainfreight and medical equipment manufacturer & exporter Fisher & Paykel Healthcare, which are scheduled to report their earnings results this week, added about 1.3 percent each.
Among heavyweight stocks, Telecom, the nation's largest phone company, gained a percent, but utility Contact Energy lost 1.2 percent and construction firm Fletcher Building edged down 0.3 percent.
Elsewhere, India's benchmark Sensex was last trading up 0.7 percent, extending gains for a third straight session. Malaysia's KLSE Composite rose 0.4 percent, Singapore's Straits Times index added half a percent and the Taiwan Weighted average gained 0.6 percent, but Indonesia's Jakarta Composite lost a percent.
On Wall Street, stocks drifted lower on Friday, as a lack of major catalysts, Facebook's disappointing debut and lingering concerns about the outlook for the eurozone prompted investors to pare their investments going into the weekend. The Dow shed 0.6 percent, the tech-Nasdaq fell 1.2 percent and the S&P 500 slid 0.7 percent.
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