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Asia shares boosted by China reforms

Hong Kong -  Asian markets on Monday extended last week's gains, with Hong Kong and Shanghai boosted by Chinese reforms aimed at giving private firms a greater role in the economy.

Traders were given another strong lead from Wall Street, where the Dow and S&P 500 closed at record highs for the third straight session, while the dollar also maintained its upward trajectory against the yen.

Tokyo rose 0.42% by the break, adding to the 4% gains seen in the previous two sessions. Hong Kong jumped 1.59%, Shanghai added 0.54% and Seoul was 0.48% higher but Sydney eased 0.58%.

Hong Kong and Shanghai enjoyed healthy gains after China on Friday released a blueprint for restructuring the world's number two economy that pledged to open up the financial sector and relax restrictions on investment.

It also said leaders planned to improve the country's initial public offering system, to adopt a more market-orientated approach.

A document issued by the official Xinhua news agency said state firms would be made to pay larger dividends to the government, while private companies would be allowed a bigger role.

The plans provided some relief to traders who had been left disappointed on Tuesday when the Communist Party's "Third Plenum" political meeting ended with a communique that outlined basic ideas for reform but few details.

Buying sentiment was also lifted by comments from the woman tipped to take over as the next Federal Reserve chief that indicated she would keep its stimulus programme in place for the time being.

Janet Yellen told senators reviewing her nomination that growth was still too fragile and unemployment too high to begin cutting the bond-buying scheme, which has provided much-needed support to the economy.

Despite expectations the Fed will continue pumping $85bn a month into financial markets, the greenback extended gains against the yen.

In early trade it bought ¥100.26, up from ¥100.12 in New York Friday, while the euro fetched $1.3478 against $1.3493. The single currency was also at ¥135.13 from ¥135.16.

The Yellen comments helped shares on Wall Street. The Dow gained 0.54% on Friday and the S&P 500 added 0.42% - both ending at record highs - while the Nasdaq was up 0.33%.

In oil trade, New York's main contract, West Texas Intermediate for December delivery, was down 22 cents at $93.62 in the morning while Brent North Sea crude for January was down 15c at $108.35.

Gold fetched $1 287.10 per ounce at 02:15 GMT compared with $1 282.81 on Friday.





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24.01
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