Asian Stocks End With Modest Gains

Updated from 1:34 a.m. EDT

Jeremiah Marquez

HONG KONG -- Asian stock markets ended mostly higher Friday, following gains on Wall Street as stronger-than-expected earnings reports from leading U.S. companies added to newfound optimism about the world economy.

The region's modest advance extended this month's bull run, driven by government measures to end the recession in the U.S. as well as signs its banks and economy are faring better than expected.

The latest upbeat news again came from the U.S., where bellwether firms Best Buy (BBY Quote) and ConAgra(CAG Quote) reported results that topped Wall Street's forecasts. Good demand at a U.S. government debt auction -- critical to funding the country's huge economic stimulus and financial bailout programs -- also encouraged traders.

While there may be more upside to the March rally, many investors will continue to watch closely for corporate distress during earnings seasons in Asia and elsewhere. Further evidence that government measures worldwide are starting to filter through the broader economy also will figure heavily.

"We're turning a little bit more cautious for the shorter term, although the macro data and government measures are quite encouraging," said Diane Lin, a Sydney-based fund manager at Pengana Capital. "We still need to see the whole packages unfold and what that will bring to the economy and the financial system."

Hong's Kong Hang Seng index edged up 0.1% after a choppy session, while Australia's S&P/ASX index added 0.7%.

Japanese stocks reversed early gains, ending an otherwise stellar week on a slightly lower note. The benchmark Nikkei 225 average dipped 0.1% to 8,626.97. But the index gained 8.6% over the past five sessions -- its biggest one-week gain since October.

Tokyo's market was dragged lower by shares of shipping companies, which fell after sector leader Nippon Yusen K.K slashed its earnings forecasts for this fiscal year.

In mainland China, the Shanghai Composite Index rose for a second day, climbing 0.5%, bringing its weekly advance to 4.1%. The advance was led by steel and silicon chip makers.

On Thursday in New York, the Dow Jones Industrial Average gained 174.75, or 2.3%, at 7,924.56, its highest close since Feb. 12. Broader stock indicators also gained, with the S&P 500 index up 18.98, or 2.3%, to 832.86.

Wall Street was headed for a lower open Friday after U.S. futures lost ground.

Stocks in London were higher Friday, while markets in Frankfurt and Paris edged slightly lower.

Oil prices retreated on concerns about the sustainability of recent gains. Benchmark crude for May delivery fell 58 cents to $53.76 a barrel in electronic trading on the New York Mercantile Exchange.

In currencies, the dollar fell to 98.34 yen from 98.63 yen.