Japan, China stocks lead Asian shares higher as yen hits 7-year low, Dow hits record high

HONG KONG – Japanese and Chinese shares led Asian markets higher Wednesday as the Nikkei touched a fresh high on the yen’s slump and Chinese business surveys offered some optimism about the world’s No. 2 economy.

KEEPING SCORE: Japan’s benchmark Nikkei 225 index added 1 per cent to 17,845.91, after rising as high as 17,881.76 earlier, the highest level since mid-2007. South Korea’s Kospi edged up 0.2 per cent to 1,969.27 and Hong Kong’s Hang Seng rose 0.6 per cent to 23,799.30 while the Shanghai Composite Index in mainland China gained 0.9 per cent to 2,789.96. Australia’s S&P/ASX 200 rose 0.4 per cent to 5,302.20.

YEN SLUMP: The Nikkei’s rise comes as the Japanese currency falls to its lowest in seven years, with the latest catalyst coming in the form of a downgrade by ratings service Moody’s to the government’s credit rating. The dollar strengthened to 119.33 yen from 119.22 yen in late trading Tuesday. The weakening yen, driven by the government’s monetary easing aimed at stimulating the economy, is good for the nation’s big exporters such as Toyota and Canon because it makes their cars and electronics cheaper overseas.

CHINA SERVICES: Shanghai shares jumped after two monthly surveys showed that activity in the No. 2 economy’s service industries edged higher. The results of an official purchasing managers’ index and a similar one by HSBC, which showed that new orders rose at their fastest in two and half years, were encouraging signs after a recent string of downbeat data.

WALL STREET: The Dow Jones industrial average gained 0.6 per cent to a record close of 17,879.55. The Standard & Poor’s 500 rose 0.6 per cent to close at 2,066.55. The Dow Jones industrial average gained 0.6 per cent to 17,879.55, while the Nasdaq composite rose 0.6 per cent to 4,755.81.

ENERGY: Oil prices rebounded, with benchmark U.S. crude rising 79 cents to $67.67 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $2.12 to settle at $66.88 a barrel on Tuesday. Brent crude, used to price internationally, rose 62 cents to $71.16 on the ICE Exchange in London.

CURRENCIES: The euro rose slightly to $1.2387 from $1.2384.