Asian markets tracked a record day on Wall Street Thursday, with Shanghai and Hong Kong supported by a Chinese central bank move to boost liquidity for major stock-buyers.
The yen sat around two-month lows after taking a hit in the wake of minutes showing Federal Reserve decision-makers were split on last month's bumper interest rate cut while a top official sparked questions about how many more could be in the pipeline.
Chinese investors were settling down after a volatile start to the week that saw mainland and Hong Kong markets whipsaw as the euphoria over last month's stimulus was dampened by a news conference that failed to unveil more measures or give details on those already announced.
Traders welcomed news that the People's Bank of China had released details of a "swap facility" that will allow "qualified securities, funds and insurance companies" to access more than $70 billion in liquidity to purchase equities.
The move, one of a number of measures announced last month, helped Shanghai rise more than one percent at one point, having dived more than six percent Wednesday -- its worst day in more than four years.
Hong Kong was up more than two percent, building on the previous day's advance that followed a more than nine percent plunge, its heftiest in 16 years.
Dealers are now keenly awaiting a Saturday news conference on fiscal policy by the finance ministry, though observers warned the bar would be high for Finance Minister Lan Fo'an if he is to get the recent market rally back on track.
The gains led a rally across Asia, which came after the Dow and S&P 500 chalked up fresh records on Wall Street thanks to a burst in tech giants including Amazon and Apple.
Tokyo was boosted by a drop in the yen fuelled by minutes from the Fed's September meeting, where it cut rates by 50 basis points but officials were split on the decision.
They showed that while the move was ultimately supported by 11-1, some "noted that there had been a plausible case for a 25 basis point rate cut at the previous meeting".
"Some participants observed that they would have preferred a 25 basis point reduction of the target range at this meeting, and a few others indicated that they could have supported such a decision," the minutes said.
Meanwhile, San Francisco Fed President Mary Daly said she had backed the big cut in order to "recalibrate" monetary policy and added that "two more cuts this year, or one more cut this year, really spans the range of what is likely in my mind, given my projection for the economy".
But she warned the bank would remain "data-dependent".
Focus now turns to the release of consumer price inflation later in the day and wholesale prices on Friday.
Shanghai - Composite: UP 0.8 percent at 3,286.30
Hong Kong - Hang Seng Index: UP 2.3 percent at 21,105.19
Tokyo - Nikkei 225: UP 0.3 percent at 39,395.05 (break)
West Texas Intermediate: UP 0.4 percent at $73.55 per barrel
Brent North Sea Crude: UP 0.4 percent at $76.88 per barrel
Dollar/yen: DOWN at 149.16 yen from 149.35 yen on Wednesday
Euro/dollar: UP at $1.0942 from $1.0940
Pound/dollar: UP at $1.3071 from $1.3062
Euro/pound: DOWN at 83.70 pence from 83.72 pence
New York - Dow: UP 1.0 percent at 42,512.00 (close)
London - FTSE 100: UP 0.7 percent at 8,243.74 (close)
