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Asian Stocks Post Healthy Gains

Stock indexes in Taiwan and Hong Kong post healthy gains while Japan manages a modest advance despite another dose of bad economic news.

Taiwan's TWSE index rose 20 percent to reach a seven-month high, after posting its largest weekly gain in nearly eleven-and-a-half years. Half of the week's gains came from electronics companies, after the world's biggest makers of personal computer processors, Intel and Advanced Micro Devices, raised their sales targets.

The primary South Korean stock index, the Kospi, finished the week at its highest point since the end of August of last year. It got a boost,in part, from gains posted by Pohang Iron and Steel, on prospects that consolidation of the steel industry in the United States will mean less supply and, consequently, higher prices.

In Japan, stock investors generally brushed off a major bankruptcy and further bad economic indicators. The benchmark Nikkei closed higher for three out of the five sessions. The bankruptcy of Aoki Corporation, a big construction contractor, however, did hurt some banking issues facing exposure to Aoki's debts. But many market participants saw it as a buying opportunity, as the collapse of Aoki could be the beginning of much needed consolidation in Japan's construction industry.

News that Japan had officially gone back into recession was viewed as no surprise, but that did give dealers another excuse to sell the Japanese currency, sending the dollar to 125 yen for the first time in four months.

In the midst of all of this, Japan's economy, trade and industry minister reiterated a pledge to keep more of the country's small businesses from going under:

Takeo Hiranuma also promised that the government will boost the economy by creating new businesses.

Singapore's recession-bound economy likely won't recover until the second half of next year. That prediction is from the country's de facto central bank, based on a survey of top economists. Singapore's Straits Times stock index rose 150 points during the five-day trading week.

Hong Kong closed out its week with the Hang Seng gaining five-and-a-third percent over three sessions. Real estate issues were boosted by the relative lack of interest in a land auction in nearby Shenzhen, China, implying, according to analysts, that developers would rather focus on projects at home in Hong Kong.