Asian stocks gain ground in sharply reduced trade

Asian closed higher on Friday in sharply reduced trade, with mild Wall Street gains adding a positive touch amid ongoing jitters over interest rates and oil prices.

Dealers the latest barbs between Washington and Tehran, with US Secretary of State Condoleezza Rice warning the UN must take action against Iran's nuclear program, was further cause for concern.

Oil have spiked sharply on Middle East tensions to the point of threatening global economic growth and this has undermined equities throughout the holiday shortened week.

However, the recent sharp sell-off had created buying opportunities, dealers added, with bargain hunters entering the market.

Shanghai gains, rising 2.04, Seoul notched-up a record close after Samsung Electronics announced a share buy-back, Tokyo and Kuala Lumpur were slightly higher.

All other major markets were closed for religious holidays with most traders not returning to business until Tuesday.

Taipei prices closed up 1.41 percent at two-year highs on sustained hopes for better ties across the Taiwan Strait.

Dealers investors were increasingly optimistic about a significant improvement in links with China, especially in terms of allowing Chinese tourists to visit freely and access for local banks there.

The market was looking to an economic forum in Beijing organized by the Chinese Communist Party and the Chinese Nationalist Party (KMT).

Additionally, Mainland Affairs Council (MAC) Chairman Joseph Wu (吳釗燮) said earlier that Taipei may unilaterally ease restrictions on visits by Chinese tourists if Beijing continues to ignore its call for negotiations.

The TAIEX rose 96.80 points at 6,952.54 on turnover of NT$118.80 billion (US$3.66 billion).

"While sentiment was bolstered by expectations of China moves to relax rules, the MAC's stance strengthens hopes for improved ties," said Johnny Lee, manager at President Securities Corp (統一證券).

"The latest developments fueled anticipation of an improvement in cross-strait ties and as a result attracted rotational interest," he said.

Ample liquidity also convinced investors to increase portfolios.

"The local bourse may consolidate upward going forward if there are no (negative) leads," Lee said.

Tokyo prices tiptoed higher in subdued Easter trade with many investors sitting on their hands ahead of the corporate results season.

Dealers worries over the risks from rising interest rates and oil prices kept a lid on sentiment. Activity was winding down with markets shut in the United States, Europe and much of Asia for the Easter holiday.

The NIKKEI-225 index rose 34.67 points or 0.20 percent to 17,233.82. Volume fell to 1.46 billion shares from 1.75 billion on Thursday. Over the week the NIKKEI fell 1.9 percent and the TOPIX shed 2.2 percent.

Seoul prices rose 1.92 percent to a record high as investors welcomed a share buy-back plan from Samsung Electronics which offset disappointing first quarter results.

Dealers that while Samsung's results fell short of expectations, at least the news was now out and investors could look forward to an improvement at South Korea's top high-tech firm.

The KOSPI index closed up 27.00 points at 1,432.72. The previous record finish on Jan. 16.

Shanghai prices closed 2.04 percent higher, on bargain-hunting after yesterday's sharp falls with steelmakers, banks and oil refiners gaining ground.

The Shanghai A-share Index added 28.53 points to 1,425.67 and the Shenzhen A-share Index was up 8.40 points or 2.41 percent at 357.25.

The benchmark Shanghai Composite Index, which covers A and B-shares, closed up 27.21 points or 2.04 percent at 1,359.54.

"Some new investors that did not have a chance to buy stocks due to previous consecutive gains, were starting to hunt for bargains after yesterday's sharp corrections," said Liu Jingde, an analyst at Beijing Securities.

Analysts the market is expected to see corrections in the near term on renewed liquidity concerns.

Malaysian prices closed 0.22 percent higher in quiet trade as late buying in index-linked stocks helped reverse earlier losses.

Dealers cautious investors continued to lock in profit amid concern over rising inflation following the recent spike in oil prices, with many players also opting to stay on the sidelines ahead of the weekend and with most regional markets closed for holidays.

The composite index ended up 2.08 points at 938.32.