LONDON (ShareCast) - Shares in Japan fell into the red on Thursday as the Bank of Japan's latest stimulus announcement disappointed while the Hang Seng rose to its highest level since August last year.
The Nikkei came under pressure as the BoJ, in its third round of monetary stimulus, said it would expand its asset-purchase programme by a further ¥10trn.
However the announcement fell short of the more aggressive stance hoped for in the wake of Japan's LDP reclaiming power.
Shinzo Abe's LDP won a landslide victory last Sunday with promises of more stimulus in a bid to defeat deflation and recover from recession.
The benchmark Nikkei 225 index closed down 121 points at 10,039 while the Hang Seng added 36 points at 22,659, a fresh 16-month high as shares of HSBC (LSE: HSBA.L - news) spearheaded gains.
Shares of the banking heavyweight rose 1.3% while Standard Chartered (Other OTC: SCBFF - news) rallied 3% after Swiss broker Credit Suisse (NYSE: CRP - news) upgraded the European banking sector.
ICBC rose 0.2%, Bank of China lost 0.6% while China Construction Bank slid nearly 1%.
Elsewhere global sourcing firm Li & Fung (Other OTC: LFUGF - news) fell 1% after profit takers moved in on Wednesday 1.8% increase.
In Tokyo exporters pulled back as the dollar gave up gains against the yen following the Bank of Japan's announcement.
Honda Motor retreated 1.8%, Nissan Motor tumbled 7.3% while Mitsubishi Motors tanked 5.5% after it said it would recall about 1.2m vehicles in Japan after discovering faulty engine oil seals.