Asian stocks gain, but China declines

Asian stocks rose led by technology companies and Japanese property developers, after Merrill Lynch & Co. raised its rating on Samsung Electronics Co. and UBS AG said a drop in real-estate companies was overdone but gave up some of the early gains after Chinese stocks nosedived.

The broad-based Topix index dropped 0.3 per cent to 1,298.59 – its first fall below 1,300 since September 2005. The Nikkei 225 dipped into negative territory early in the afternoon session but then recovered to trade 0.8 per cent higher at 13,610.19.

 Hong Kong’s Hang Seng Index slid 0.4 percent.

In China, financial shares led a fall of over 3 percent after the central bank late on Wednesday announced an increase in bank reserve requirements. China’s CSI 300 Index tumbled 3.2 percent, after recording its biggest fall in nearly two months the previous day.

China ordered banks late yesterday to increase their reserves for the 11th time in 13 months to curb inflation in the world’s fastest-growing major economy. Banks must put aside 15 percent of deposits, the most in at least 20 years. The government also ordered suppliers of grain, oil, meat and other staples to seek approval for price increases. Inflation soared to 6.9 percent in November.