Shares in Asia overcame news of higher-than-expected inflationary data in China and lower-than-expected liquidity data in Japan to finish higher Monday. Markets in Hong Kong were closed for a religious holiday.

The Japanese Nikkei finished 88 points, or 0.6% higher, at 13,743.36, and the Shanghai Composite Index rose 13 points, or 0.4%, at 3626.98.

Chinese consumer price inflation rose 8.5% in April vs. expectations of 8.2%. The number is the second-highest in 2008, after February, where inflation increased 8.7% as a result of snowstorms. Still, the country recorded a surplus of $16.7 billion vs. $13.4 billion in March, leading many economists to speculate that aggressive growth may offset soaring prices.

"We have raised our 2008 GDP growth forecast from 9.5% to 9.8%," writes Lehmans analyst Mingchun Sun in a research note issued Monday in Hong Kong. "Strong domestic demand offsetting weaker external demand seems an ideal scenario for China against a backdrop of an unfolding global downturn."

China Watch: Know the Numbers Before You Buy

Most stocks were sluggish, but still in green territory, as investors mulled the data. After beginning in the red for the day, the Shanghai Composite Index spent the afternoon climbing on bargain sentiment. Still, dealers said the outlook for Hong Kong-listed shares was uncertain, and that late trading in U.S.-listed ADRs will be the best clue. ADRs are expected to see early gains in New York.

Financials were broadly higher. Industrial & Commercial Bank of China ( IDCBF) rose 0.3%, to 6.16 yuan, and Bank of China ( BACHF) inched up 0.2%, to 5.01 yuan.

Among dual-listed Hong Kong and Chinese shares, performances were mixed. China Life Insurance ( LFC) tumbled 0.7%, to 33.20 yuan, and rival Ping An ( PIAIF) dropped 2%, to 62.82 yuan, since these shares do not tend to perform well in times of high inflation.

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