Asian markets mixed, weak yen lifts Tokyo

The yen retreated after a two-day rally as Japan logged a record trade deficit for last year with exports were hit by the ongoing territorial spat with China and Europe's long-running debt crisis.

Tokyo reversed early losses thanks to the yen's dip, with the Nikkei up 1.28 percent, or 133.88 points, at 10,620.87, while Sydney rose 0.47 percent, or 22.4 points, to 4,810.2, but Seoul shed 0.80 percent, or 15.93 points, to 1,964.48.

In afternoon trading Shanghai was down 0.60 percent on profit-taking and Hong Kong lost 0.13 percent despite data showing manufacturing activity in China last month expanded at its fastest pace since January 2011, dealers said.

In China HSBC said its preliminary purchasing managers index (PMI) rose to 51.9 in January from 51.5 in December, a 24-month high.

Anything above 50 indicates growth while anything below is contraction.

The news reinforces views that the world's number two economy has picked up after a drawn-out slumber. On Friday official figures showed gross domestic product grew at a faster pace than expected in 2012 and at a quicker pace than the government had hoped.

The results provided a fillip to Japan's Nikkei, while data showing Japan suffered a second consecutive annual trade deficit last year sent the yen tumbling, providing shares with another lift.

Official figures from the finance ministry showed Japan's trade shortfall last year totalled 6.92 trillion yen ($78 billion), with the deficit in December alone standing at a higher-than-expected 641.5 billion yen.

The yen had enjoyed a two-day rally from Tuesday -- and equities slumped -- after the Bank of Japan disappointed dealers with its two percent inflation target and indefinite monetary easing, which they said was not enough.

In afternoon currency deals the greenback bought 89.31 yen, compared with 88.56 yen in New York late Wednesday. The dollar, however, is still down from the two-and-a-half-year high 90.24 yen before the BoJ move.

The euro bought 119.16 yen from 118.00 yen, and $1.3344 from $1.3315.

The three main indexes on Wall Street ended higher after a string of upbeat earnings from firms including IBM and Google.

The Dow ended up 0.49 percent, at its highest level since October 2007, while the S&P 500 advanced 0.15 percent and the Nasdaq climbed 0.33 percent.

However, after US markets closed Apple released flat October-December first quarter earnings and sales of key products such as the iPhone 5 came in below expectations.

Recently, the iPhone 5 made a lacklustre debut in China and an analyst reported that Apple had cut orders for smartphone parts.

Wednesday's results sent shares in the computer giant slumping more than 10 percent in after-hours trade.

Regional firms linked to Apple ended mixed Thursday after beginning the day in negative territory.

Supplier LG Display fell 1.21 percent in Seoul, but in Tokyo TDK added 0.96 percent and telecoms firm Softbank, which sells the iPhone, was up 0.27 percent.

South Korean shares were also hurt by data showing the economy grew 2.0 percent in 2012, its slowest pace in three years, owing to overseas turmoil and soft demand at home.

Oil prices were mixed. New York's main contract, WTI light sweet crude for delivery in March gained 35 cents to $95.58 a barrel in the afternoon while Brent North Sea crude for March delivery dropped three cents to $112.77.

Gold was at $1,680.05 at 0700 GMT compared with $1,691.66 late Wednesday.

In other markets:

-- Taipei fell 0.62 percent, or 48.19 points, to 7,695.99.

TSMC fell 1.09 percent to Tw$99.9 while HTC was 0.88 percent lower at Tw$281.0.

-- Wellington was flat, edging up 2.19 points to 4,189.91.

Telecom rose 0.86 percent to NZ$2.34, Fletcher Building was down 1.61 percent at NZ$9.19 and Contact Energy was steady at NZ$5.20.