Asian markets were higher Wednesday, as concerns over political stability in Europe faded, while a weaker yen pushed Japanese stocks to a fresh 33-month high.
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Tuesday's correction, which resulted in a 1.4% decline in the broad MSCI Asia Index, proved short-lived as stocks across the region resumed their upward trajectory. Concerns over Europe that prompted the sharp fall in the previous session receded as the continent released encouraging economic numbers: manufacturing data for the euro zone showed its third consecutive monthly improvement in January, rising to its highest level since March 2012.
In Asia, the focus was on the yen once again. The Japanese currency fell versus the U.S. dollar overnight Tuesday after Bank of Japan Governor Masaaki Shirakawa said that he would step down on March 19, three weeks earlier than the scheduled end date for his term.
Mr. Shirakawa's decision to leave early will speed up the search for his successor. The new government is expected to choose a governor who will be more amenable to its plans to employ aggressive monetary easing to stimulate Japan's stagnant economy.
The U.S. dollar which rose 1.4% overnight Tuesday against the yen, continuing to gain in Asian trading. The dollar was recently at �93.84.
Japanese stocks were boosted by the weaker yen, with the Nikkei Stock Average up 3%, recovering entirely from Tuesday's 1.9% loss. Exporters were higher, especially car companies: Honda Motor was up 3.2% and Mazda Motor advanced 4.8%.
In addition to the weaker yen, Toyota Motor Corp. benefited from a positive third-quarter earnings report. The auto maker's stock was up 5.2% after announcing a 23% on-year increase in net profit for its most recent fiscal quarter and increasing its full-year net profit outlook.
The other major earnings report to come out of Asia on Wednesday was from Singapore, where the FTSE Straits Times Index was flat. DBS Group Holdings, Southeast Asia's largest bank by assets dropped 1.9% as the market was disappointed that net profit rose by just 4% in the fourth quarter from a year earlier.
In China, stocks were mixed. The Shanghai Composite Index was flat ahead of trade and inflation data out on Friday, while the Hang Seng Index in Hong Kong made a partial recovery from the selloff on Tuesday, rising 0.5%.
In Australia, the S&P/ASX 200 added 0.9%, with large miners Rio Tinto and BHP Billiton up 0.8% and 0.6% respectively.
South Korea's Kospi Composite was up 0.1%.
Write to Daniel Inman at daniel.inman@wsj.com
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