Asian stocks rose on Wednesday, buoyed by Japanese shares, as investors braced for a snap election in Japan that could lead to more fiscal stimulus, while worries about US central bank independence and benign US inflation data whipsawed currencies.

In Hong Kong, the benchmark Hang Seng Index opened 123 points, or 0.5 percent, higher at 26,971. The China enterprises index was 42 points, or 0.5 percent, up at 9,328 while the tech index rose 24 points, or 0.4 percent, to 5,894.

On the mainland, the Shanghai Composite Index opened unchanged from its close on Tuesday at 4,138, while the Shenzhen Component Index opened 0.17 percent higher at 14,194.

The ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, was up 0.34 percent at 3,333.

The Star Composite Index, which reflects the performance of stocks on China's sci-tech innovation board, opened 0.35 percent higher at 1,812 while the Star 50 Index, which tracks the largest stocks listed on the board that also meet certain liquidity requirements, opened 0.66 percent higher at 1,479.

Geopolitical tensions across the globe lifted gold to a record peak and sent oil prices higher as US President Donald Trump urged Iranians to "keep protesting". Iran in turn accused Trump of encouraging political destabilisation and inciting violence.

The yen hit its weakest level since July 2024 at 159.415 per US dollar in early Asian hours, as the threat of a market intervention resurfaced. Local media reported that Prime Minister Sanae Takaichi was considering calling a snap lower house election on February 8.

The frail yen and the prospect of more stimulus sent the Nikkei ‍up more than 1 percent to a record and pushed Japanese government bonds lower, a so-called "Takaichi trade" that appears to have been turbocharged ⁠this week as investors worry about the country's fiscal health.

Masahiko Loo, senior fixed income strategist at State Street Investment Management, said the market moves reflected expectations of ‍fiscal easing, though they may be overstated given political constraints as Takaichi's coalition would need the opposition's support in the upper house to pass legislation.

"Any sharp and decisive break beyond 161 level [for yen] could trigger renewed intervention to curb excessive volatility," Loo said.

"In that scenario, expectations for a Bank of Japan rate hike may shift forward to April, potentially serving as an inflection point for currency dynamics." (Reuters/Xinhua)