Asian shares up after Mubarak's resignation

Asian stock markets rose on Monday as the resignation of Egyptian President Hosni Mubarak eased investors worries over political instability in the Arab world's biggest nation.

Japan's Nikkei 225 stock average climbed 80.78 points, or 0.8 percent, to 10,686.43. Hong Kong's Hang Seng index added 0.6 percent to 22,961.86, while China's Shanghai Composite index was up 0.7 percent at 2,846.32.

While Mubarak's ouster buoyed sentiment, investors traded with caution ahead of Tuesday's release of China's inflation data for January. The inflation rate in December was 4.6 percent compared with a 28-month high of 5.1 percent the month before.

If the January inflation rate returns to the 5-percent level, investors speculate Beijing could raise interest rates as early as next month in a bid to tame inflation. China hiked rates in early February for the second time in just over a month.

Rising prices are especially sensitive in a country where poor families can spend up to half their incomes on food. Higher incomes have helped to offset price hikes, but inflation undercuts economic gains that help support the ruling Communist Party's claim to power.

Elsewhere, Australia's S&P/ASX index was up 0.9 percent at 5,016.50. South Korea's Kospi gained 1.6 percent to 2,008.01. Shares in New Zealand, Singapore and Taiwan were all higher.

Sentiment was upbeat across Asia as investors were relieved by the departure of 82-year-old Mubarak, who surrendered power to the military Friday after an 18-day uprising by millions of protesters demanding his resignation.

Investors had been worried during the nearly three weeks of anti-government demonstrations that the unrest in Egypt could spread to countries like Saudi Arabia, one of the world's biggest exporters of oil.

In New York on Friday, the Dow Jones industrial average rose 43.97 points, or 0.4 percent, to 12,273.26, its highest finish since June 2008, as investors took heart from Mubarak's departure following his nearly 30-year authoritarian rule.

In Tokyo on Monday, Japan's government said its economy stumbled in the last three months of the year, contracting for the first time in five quarters.

Japan's gross domestic product shrunk at an annualized rate of 1.1 percent in the October-December period, a sharp reversal from a revised 3.3 percent expansion in the third quarter, the government said Monday.

But investors shrugged off the growth contraction data as the result was better than Kyodo news agency's average market forecast of an annualized 2.2 percent decline.

In currencies, the dollar slipped to 83.15 yen in Tokyo on Monday from 83.40 yen in New York late Friday. The euro was quoted at $1.3545 from $1.3551.

Oil prices, meanwhile, hovered below $86 a barrel Monday as higher commodity prices threaten to undermine strong regional economic growth. Benchmark crude for March delivery was down 3 cents at $85.56 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.15 to settle at $85.58 a barrel on Friday.