TOKYO (MarketWatch) -- Asian share markets finished mostly lower Wednesday as investors remained wary of the size of recent stock market gains, but trading ended higher in Tokyo as fresh talk about an improving economy helped rescue the market from a third day of losses.
Australia's S&P/ASX 200 closed 1.5% lower and South Korea's Kospi Composite slipped 0.6%. Hong Kong's Hang Seng Index ended 0.5% lower, Taiwan shares shed 0.4% and New Zealand's NZX-50 fell 0.3%. But China's Shanghai Composite added 1.2% led by gains in industrial stocks and Japan's Nikkei finished up 0.9%, showing some resilience after Tuesday's 2.9% tumble, which was its biggest one-day loss since March 30.
"Overall, most markets are lower and gains in Japanese ... stocks appear more related to country-specific factors," said Mitul Kotecha, head of global FX Research at Calyon.
"Japanese markets have been helped by the news that Fitch Ratings Ltd. will maintain the country's sovereign ratings at AA- despite the government dropping its goal of balancing the budget by 2011," he said.
Strength in Tokyo-traded shares also came a day after the Bank of Japan said the nation's economic conditions have "begun to stop worsening." In a monthly report issued Wednesday, the central bank said that in the coming months, the economy is "likely to show clearer evidence of leveling out over time."
"There was relentless buying last week because of all the economic signals and the new buzz word was 'green shoots,'" said RBS director David Iron in Sydney. But "people are now being a little bit more risk averse, plus you're seeing a renewed wave of capital raisings."
ABN Amro broker James Porteous in New Zealand said that "in the last two or three weeks people have been getting a bit more nervous, they are standing back again. People just don't seem to think things are that cheap."
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