China shares at 7-year highs on stimulus hopes

China shares at 7-year highs on stimulus hopes

30 March 2015, 09:21
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Asian started the week in the green zone with Chinese shares testing highs last seen in May 2008 on stimulus hopes.

The Shanghai Composite was up 2.4% to 3,779.13, while Hong Kong's Hang Seng index was 1.7% higher at 24,907.42.

Mainland shares led the region up as Beijing unveiled plans to construct a modern Silk Road to improve links to Europe and Africa. Investors anticipated more infrastructure spending and policy easing.

Greater China shares also surged after China allowed mainland mutual funds to buy Hong Kong stocks via the Shanghai-Hong Kong Stock Connect.

In Japan, shares were higher despite negative factory production data, which showed the biggest plunge in output since June 2014. The benchmark Nikkei 225 closed up 0.7% at 19,411.4.

In February industrial output fell 3.4% from the previous month as firms curbed production due to the Lunar New Year holidays.

In South Korea, the benchmark Kospi index ended higher 0.5% to 2,030.04 points. Market players shrugged off central bank data indicating that manufacturing sentiment fell for April, highlighting uneven confidence among businesses.

Bucking the trend, Australian shares declined with resource stocks weighing on the benchmark index due to record low iron ore prices and sliding oil prices.

As oversupply worries spread, iron ore prices hit fresh all-time lows, while the price of oil tumbled 5% on Friday.

The S&P/ASX 200 closed down 1.3% 5846.1, its lowest since 18 March.

Shares of Caltex Australia plunged as much as 10.2% after US energy giant Chevron sold its entire stake in the refiner for $3.6bn, becoming the latest global energy player to exit Australia's refining industry. It closed down 9.1%.

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