Asia stocks march higher, Japan rallies

SYDNEY (MarketWatch) � Asian stocks gained solidly Wednesday, as investors bought up financials, shippers and resource shares, while a relatively weak yen provided an extra lift in Japan.

The largest markets of the region were showing strong gains, with Japan�s Nikkei Stock Average JP:100000018 JP:100000018 up 1.4%, JP:100000018 building on an identical 1.4% increase Tuesday, and Hong Kong�s Hang Seng Index HK:HSI HK:HSI climbing 0.9%.

Likewise, South Korea�s Kospi KR:SEU KR:SEU advanced 0.8%, and Australia�s S&P/ASX 200 index AU:XJO climbed 0.9%, though the HK:HSI Shanghai Composite Index CN:000001 traded up a milder 0.1%.

Asia stock markets briefly retreated from their highest levels of the day, while U.S. stock futures were mildly lower, amid some early indications that President Barack Obama won the second debate held late Tuesday in the run-up to the presidential election on Nov. 6. Read full story on the second debate.

Click to Play Obama, Romney argue oil drilling

President Barack Obama and Mitt Romney spar over the economics and environmental costs of oil production and drilling during the presidential debate in Hempstead, N.Y. Photo: Getty Images.

Jerry Webman, chief economist at OppenheimerFunds, said after the debate wrapped up: �I think many market participants will continue to prefer Gov. Romney � they have concerns about taxes on capital, about regulation, and market might read [an Obama win] less favorably.� Read more about the debate.

U.S. stocks put in a upbeat performance Tuesday on data, earnings and ongoing optimism that Europe will find a way out of its debt troubles. Read more on Dow scores biggest gain since mid-September.

�Investors are hoping that policy makers around the world will succeed in reducing market risks and gradually turning the global economy around,� said Dariusz Kowalczyk, strategist at Credit Agricole.

The Nikkei reported that Japanese Prime Minister Yoshihiko Noda will likely call an emergency cabinet meeting Wednesday to discuss stimulus measures for the Japanese economy.

The dollar USDJPY traded at 78.68 yen, down slightly from �78.91 in late action Tuesday, but holding onto gains for October, a month that has so far seen the dollar rise 0.9% against the yen, according to FactSet.

At the same time, the euro rose to a one-month high against the yen after reports Tuesday that Spain was considering applying for a credit line from the European Union�s bailout fund, and after Moody�s Investors Service affirmed Spain�s sovereign rating at Baa3. Read more on Moody's action on Spain.

In that currency environment, exporters trading higher on Wednesday included Sony Corp. JP:6758 SNE , up 2.8%, Panasonic Corp. JP:6752 PC up 2.9% and Toyota Corp. JP:7203 TM up 2.1%.

Suzuki Motor Corp. JP:7269 SZKMF rose 2.4% after its Indian joint venture Maruti Suzuki India Ltd. IN:532500 . introduced an upgraded model of its popular Alto car.

With Europe concerns easing a bit, financials also gained in Tokyo, as Nomura Holdings Inc. JP:8604 NMR advanced 3.3%, and Matsui Securities Co. JP:8628 MAUSY climbed 2.1%.

It was a similar story in Hong Kong, with Europe-exposed market heavyweight HSBC Holdings PLC UK:HSBA HBC HK:5 up 1.6%.

The gains extended to some Chinese banking names, with Industrial & Commercial Bank of China Ltd. HK:1398 IDCBY rising 1.4% and China Construction Bank Corp. HK:939 CICHY adding 1.6%.

Port operators, tied to global trade, were also higher in Hong Kong, with Cosco Pacific Ltd.HK:1199 CSPKY up 3.8% and China Merchants Holdings International Co. HK:144 CMHHF advancing 4.4%.

Many South Korean shipping firms also saw strong gains, with STX Pan Ocean Co. KR:028670 jumping 7.2% and Hanjin Shipping Co. KR:117930 improving by 4.3%.

Growth-sensitive resource firms performed strongly in Australia, with Rio Tinto Ltd. AU:RIO RIO up 1.7% and Fortescue Metals Group Ltd. AU:FMG FSUMF ahead by 5.7%. Each posted production reports a day earlier.

South Korea made similar resource-share gains, as SK Innovation Co. KR:096770 advanced 3.6%, while S-Oil Corp. KR:010950 rose 3.8%.

In Hong Kong, Aluminum Corp. of China Ltd. HK:2600 ACH , or Chalco, gained 3%, while Jiangxi Copper Co. HK:358 JIXAY rose 2.7%.

Gains for the firms were less pronounced in Shanghai, however, with Chalco CN:601600 up 0.6% while Jiangxi Copper CN:600362 advanced 0.3%.

But property firms lost ground on the Chinese mainland, with Poly Real Estate Group Co. CN:600048 down 0.9%.

In Tokyo, Softbank Corp. JP:9984 SFTBF rose another 4.2%, adding to a 9.6% surge a day earlier, and paring losses made since late last week to just over 14%, as investors reassessed the telecom�s planned purchase of a controlling stake in Sprint Nextel Corp. S .