SHANGHAI, China - Asian markets rallied Monday as investors were heartened by Wall Street's rebound last week and by reports downplaying the impact of disastrous winter storms on China's broader economy.
Investors also snapped up shares of major miners Rio Tinto and Aluminum Corp. of China on Friday's news that the Chinese company and Alcoa Inc. had bought a big stake Rio Tinto, which is listed in both Sydney and London.
China's stock market was by far the strongest Monday, with the benchmark Shanghai Composite Index surging 6.2 percent to 4,590.12 by midday, lifting the market off six-month lows hit last week.
Hong Kong's Hang Seng index jumped more than 3 percent, and Japan's Nikkei 225 index rose 2.7 percent to close at 13,859.70 points. Markets in South Korea and India also rose.
Last week's rally on Wall Street — which put in its best five-day gain since March 2003 — boosted sentiment in Asia, where markets have tumbled since the start of the year on worries about a U.S. recession. While those concerns lingered, investors focused on Microsoft Corp.'s bid for Internet company Yahoo Inc. and a possible rescue plan for the troubled bond insurance sector.
In Tokyo, Yahoo Japan shares shot up 9.5 percent, while Softbank Corp., which owns part of Yahoo Japan, surged 16 percent. Japanese bank, brokerage and real estate issues also advanced.
Investors in mainland China and Hong Kong bid up stocks after China's state-run newspapers carried front-page statements by top economic officials downplaying the likely impact of the winter storms that have gripped southern China with its worst snowfalls in 50 years.
"There's no need to worry. The losses will be recovered and investors should not worry," the China News Service quoted Li Rongrong, chairman of the agency in charge of big state corporations, as saying.
So far, official estimates put the damage from the storms at $7.5 billion. Last week, the government ordered banks in regions affected by the storms to relax limits on lending, also reassuring investors worried over inflation-fighting credit tightening policies.
Zhu Hongren, deputy director of the National Development and Reform Commission — the country's top economic planning body — emphasized that damages and losses were confined to only some parts of southern and central China.
"The fairly severe disaster did not affect the whole country," the state-run newspaper China Business News cited Zhu as saying. "Even though the impact on industry is evident, the impact on the entire economy is limited," Zhu said.
Aluminum Corp. of China, or Chinalco, surged by the daily 10 percent limit to 32.34 yuan after announcing late Friday that is has acquired, along with U.S. partner Alcoa Inc., a 12 percent stake in London-based Rio Tinto PLC.
The news comes just days ahead of a Wednesday deadline set by British regulators for BHP Billiton to either formalize its $130 billion proposal to merge with Rio Tinto, a deal that would create a monolithic mining company and that Chinese officials have previously expressed concerns about.
In Sydney, Rio Tinto shares closed less than 1 percent higher at 128.11 Australian dollars, while BHP Billiton ended 2 percent higher at A$39.32.
The mainland Chinese market was further boosted by news that the China Securities Regulatory Commission had approved two new stock funds — raising the likelihood of fresh flows of cash into the markets.
CCB Principal Asset Management Co. and China Southern Fund Management Co. are due to raise a total of about $1.95 billion later this month, the official Xinhua News Agency reported.
On Friday, New York's Dow Jones industrial average gained 0.7 percent to round out a strong week. Both the Dow and the Standard & Poor's 500 index rose more than 4 percent for the week.
U.S. stock index futures were down slightly or flat. Dow futures were down half a point to 12,751, while S&P 500 futures were barely changed.
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