Asian stocks rose across the board on Friday after the European Central Bank said it would inject over 1.0 trillion euros ($1.15 trillion) into the sagging euro zone economy in a bid to avert a deflationary spiral and boost growth. It is believed that a major portion of the hundreds of billion in new money pumped into the economy will find its way into equity markets.
Chinese shares ended a choppy session modestly higher, led by gains in banks and property developers. The benchmark Shanghai Composite index closed 0.25 percent higher at 3,351.76, but posted its first weekly loss since November 7. Hong Kong's Hang Seng index rallied 1.34 percent to finish at 24,850.45, its highest level since September 8.
The People's Bank of China on Thursday said it had injected about $8 billion into the banking system through seven-day reverse-repurchase agreements, spurring speculation that further loosening of monetary policy is on the cards. Meanwhile, China's manufacturing growth picked up momentum in January, although activity shrank for a second straight month, a survey from HSBC Bank showed with a preliminary PMI score of 49.8, up from 49.6 in December and beating forecasts for 49.5.
Japanese shares rose to a near one-month high, with exporter shares outperforming on growing bets that the yen would fall against the dollar to a record in the wake of the ECB's Thursday announcement that it would purchase 60 billion euros per month worth of securities, including investment grade sovereign bonds, beginning in March.
The asset purchases program will remain in place until there is "a sustained adjustment in the path of inflation which is consistent with" the ECB's aim of achieving inflation rates below, but close to 2 percent over the medium term, ECB President Mario Draghi said in his customary post-decision press conference in Frankfurt. The benchmark Nikkei average rose 1.05 percent to 17,511.75, its highest level since December 29, while the broader Topix index gained about a percent.
Sony shares climbed 4.9 percent, Fanuc rallied 3 percent, Hitachi advanced 2.5 percent and Toyota Motor rose 1.3 percent. Heavyweight Fast Retailing gained 0.9 percent, energy firm Inpex advanced 1.7 percent and automakers such as Honda Motor, Mazda Motor and Suzuki Motor rose between 0.9 percent and 1.6 percent. Mobile carrier SoftBank Corp jumped 4.2 percent on merger news.
Banks ended broadly higher, with Mitsubishi UFJ Financial, Mizuho Financial and Sumitomo Mitsui Financial all rising about a percent each. Robotics manufacturer Yaskawa Electric Corp. soared 5.7 percent after raising its net profit forecast. Yamato Holdings tumbled 3.4 percent. The parcel delivery company said it plans to discontinue its mailbox delivery service at the end of March.
In economic news, Japan's manufacturing sector expanded at an accelerated pace in January, a survey showed. The Markit/JMMA manufacturing PMI edged up to 52.1 from 52 in December, expanding for the third consecutive month.
Australian shares hit a 10-week high after the ECB announced a major stimulus program and data showed Chinese manufacturing sector strengthened slightly at the start of the year. The benchmark S&P/ASX 200 index climbed 1.5 percent to finish at 5.501.8, its highest level since November 11, ahead of the Australia Day holiday on Monday.
Santos shares soared 5.1 percent. The oil and gas producer posted record annual and quarterly sales revenue notwithstanding the fall in oil prices. Rival Woodside Petroleum advanced 2.3 percent and Oil Search jumped 3.3 percent, tracking surging oil prices following the death on Friday of Saudi Arabia's King Abdullah.
The big four banks rose between 1.2 percent and 1.4 percent as the ECB's bond-purchase program spurred speculation that Australia's central bank could further ease interest rates from a record low. ResMed shares rallied 2.9 percent after the sleep disorder specialist reported strong double-digit revenue growth for the three months ended December.
Mining stocks ended mixed, with BHP Billiton rising 1.6 percent and Rio Tinto adding 0.6 percent, while Fortescue Metals Group dropped 1.8 percent and BC Iron tumbled 4.2 percent. Arrium slumped 8.9 percent after announcing job cuts as it closes one of its iron ore operations in South Australia.
Seoul shares hit a four-week high, as investors shrugged off weak GDP data and focused on the ECB stimulus plan announced overnight. The benchmark Kospi average rose 0.79 percent to finish at 1,936.09, led by technology and logistics stocks. Heavyweight Samsung Electronics rose 0.6 percent, while Hyundai Motor, South Korea's largest automaker, ended on a flat note. Kia Motors dropped 1.3 percent after reporting a 54 percent fall in quarterly net profit, missing expectations.
On the economic front, South Korea's economic growth slowed sharply in the final quarter of 2014, mainly as a result of weaker construction and government spending, central bank data showed. GDP rose a seasonally adjusted 0.4 percent on sequential terms, down from 0.9 percent growth in the third quarter and marking the slowest rate of growth in six quarters. On an annual basis, GDP expanded 2.7 percent - missing expectations for 2.8 percent growth and down from 3.2 percent in the previous three months.
New Zealand shares hit a record high, joining a global rally. The benchmark NZX-50 index rose half a percent to finish at 5,675.24 as energy stocks rebounded from the previous session's declines. Mighty River Power and Genesis Energy rose about 3 percent each on expectations that the ECB's quantitative easing program will keep the global liquidity situation benign. Kathmandu Holdings rose half a percent after the outdoor clothing retailer appointed Xavier Simonet as its new chief executive officer. Biotech firm Pacific Edge paced the decliners, falling 5 percent to 76 cents.
Elsewhere, the benchmark indexes in India, Indonesia, Malaysia, Singapore and Taiwan were up between 0.8 percent and 1.3 percent.
On Wall Street, stocks chalked up their four straight day of gains on Thursday, as regional banks and transportation companies posted better-than-expected earnings, data on jobless claims pointed to continued improvement in labor market conditions and the ECB announced a bigger-than-expected program of asset purchases to stimulate the region's sagging economy. The Dow and the S&P 500 rallied about 1.5 percent each, while the tech-heavy Nasdaq soared 1.8 percent.
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