Asian markets rallied in Thursday's trading, with Hong Kong posting gains for the seventh consecutive trading day. The move was led by overnight gains on Wall Street and renewed demand for financial stocks.

In Hong Kong, the Hang Seng gained 213 points, or 0.73%, to 29,558, but in China the Shanghai Composite Index ended marginally lower, down 0.15%, at 5,035.

In Japan, the Nikkei closed up 265 points, or 1.7%, to 15,874, as

Mitsubishi UFJ

(MTU)

and

Mizuho Financial

(MFG) - Get Report

notched up some of the biggest gains of large-caps in the region. Mitsubishi UFJ surged 6.6%, to 1,228 yen, while Mizuho Financial soared 5.5%, to 648,000 yen, following renewed optimism over the U.S. credit scenario on Wednesday.

"These

upward swings do not come out of the blue. When you look at emerging economies, especially Asia, you have to make a distinction between real economic growth and financial growth," says Serdar Kucukakin, emerging Asia economist for ABN Amro.

Kucukakin adds that many Asian financials remain strong compared to their U.S counterparts.

A broadly weakening yen pushed shares in Japanese exporters higher, too.

Sony

(SNE) - Get Report

jumped 2.4%, to 6,000 yen, while

Honda

(HMC) - Get Report

gained 2.4%, to 3,820 yen, and

Nintendo

(NTDOY)

clawed back Wednesday's losses, ending the day 1.2% higher, at 67,900 yen.

The yen hit a one-week low, at 111 yen vs. the dollar by the end of the Asian trading session.

Other Japanese stocks riding the region's rally included electronics makers

TDK

( TDK) and

Kyocera

(KYO)

, rising 4.9%, to 8,290 yen, and 3.7%, to 10,190 yen, respectively, and financial conglomerate

Orix

(IX) - Get Report

, which climbed 3.1%, to 21,620 yen.

Hong Kong was led higher by financials too, with

Hang Seng Bank

(HSNGY)

leaping 5.1%, to HK$166.90.

Telecoms started strong, but succumbed to weakness after profit-taking in the afternoon session. After hitting a 52-week high of HK$26.50 on the open,

China Netcom

(CN) - Get Report

slumped 2%, to HK$24.60 at the close.

China Unicom

(CHU) - Get Report

and

China Telecom

(CHA) - Get Report

both ended down too, losing 1.1% to HK$16.16, and 3.07%, to HK$6.31, respectively.

China Mobile

(CHL) - Get Report

managed to maintain some strength, however, finishing 0.6% higher at HK$145.70.

Property stocks continued a run of strength, ahead of the expected interest rate cut by the

Federal Reserve

.

Sun Hung Kai

(SUHJY)

rose 1.32%, to HK$10.74, while

Hang Lung Properties

(HLPPY)

climbed 3%, to HK$37.55, and

Hutchison Whampoa

(HUWHY)

gained 0.82%, to HK$92.55.

Cheung Kong

(CHEUY)

declined for the second day running, however, down 2.12% at HK$147.70 on profit-taking after last week's gains of 5.5%.

Elsewhere in Asia, in South Korea the Kospi rose 15 points, or 0.77%, to 1,953, while in Malaysia the Kuala Lumpur Stock Exchange hit a 52-week high, closing up 12 points, or 0.9%, at 1,440 points.

The recent gains in Asian stocks mark an end to November's bearish slump, which some market participants say was expected.

"Asia is still booming, and inter-regional trade has been booming in the past couple of months and even years -- that's what makes us so bullish on emerging Asia going into next year," says ABN Amro's Kucukakin.

Daniel M. Harrison is a business journalist specialising in European and emerging markets, in particular Asia. He has an MBA from BI, Norway and a blog at

www.theglobalperspective.biz

. He lives in New York.