Most Asian stocks rise on hopes of China recovery, currencies subdued

MOST Most Asian stock markets rose on Thursday, enlivened by hopes that China will soon reveal details of its fiscal stimulus plans, while currencies were subdued ahead of U.S. inflation data due later in the day.

Shares in Shanghai led the charge, gaining about 3% on anticipation for China's finance ministry to unveil detailed plans on Saturday, following a disappointing media briefing on Tuesday.

Other regional equity markets followed the lead, with benchmarks in Bangkok, Seoul and Kuala Lumpur adding between 0.3% and 0.6%.

"Markets may be getting optimistic that we might see a bit more detail that could support the view that China's basically trotting out and will start to grow again," said Robert Carnell, Asia-Pacific head of research at ING.

China's central bank also started accepting applications from financial institutions to join a new funding scheme, initially worth 500 billion yuan ($70.8 billion), to aid the capital market.

"If sentiment and the China story are looking more positive than they should, that should lift all the markets in the region (EM), at least for a while," Carnell added.

Most regional currencies were subdued, however, ahead of the U.S. September inflation report.

The inflation figure will give global investors more clues to the Fed's November course on monetary policy after its September meeting minutes showed "some" participants were inclined towards a quarter-point cut, a sign the rate cut cycle will not be as aggressive as previously seen.

"If the Fed was aggressively easing, then you'd likely see a much weaker dollar and that would just make it easier for the central banks that we think have room to ease (because their currencies will be looking stronger)," Carnell said.

The Philippine peso, Malaysian ringgit and Indonesian rupiah slipped between 0.1% and 0.2%.

Attention also turns to the Bank of Korea, which is expected to kickstart its easing cycle with a cut of 25 basis points on Friday, to join Asian peers, Bank Indonesia and the Philippine central bank, a Reuters poll showed. Markets in Taiwan were closed for a holiday.

HIGHLIGHTS:

** Indonesia's Prabowo defends plan to expand government with 'fat' cabinet

** Talks conclude on upgrade to ASEAN-China free trade area, Singapore says

** Japan's wholesale inflation perks up, yen rise eases cost pressure - Reuters