By Shri Navaratnam and Ga-Woon Philip Vahn Of DOW JONES NEWSWIRES SINGAPORE (Dow Jones)--Asian stock markets were mostly up Wednesday, but many bourses were off their morning highs after inflation data in China suggested further tightening measures from Beijing are likely. Japan's Nikkei Stock Average gained 0.5% to 9856.6, Australia's S&P/ASX 200 rose 0.8% and South Korea's Kospi Composite was 0.7% higher. The Shanghai Composite Index fell 0.1%, while Hong Kong's Hang Seng Index rose 0.2%, Taiwan's main index gained 0.1% and India's Sensex fell 0.2%. Dow Jones Industrial Average futures were up 24 points in screen trade. A sense of caution crept into markets after China released a slew of data that suggested policymakers are likely to impose further tightening measures to curb inflation and credit growth. The country's consumer price index rose 5.3% in April from a year earlier, slowing from the 5.4% rate in March but topped the median forecast of a 5.2% rise in a Dow Jones poll of 14 economists. Royal Bank of Canada economist Brian Jackson said the latest inflation figures signaled that policy tightening measures over the past several months are having an impact, though price pressures are still uncomfortably strong. "The CPI growth is slightly higher than expectations. It's still too early for the government to end its tightening measures," said HSBC economist Ma Xiaoping. Property developers fell in Shanghai as the real estate sector is considered highly vulnerable to monetary tightening measures. China Vanke lost 0.6%, Zhejiang Guangsha fell 1.0% and China Merchants Property was down 0.7%. The Seoul market surrendered some of its morning-session gains after the release of the China inflation data. Since China is the South Korea's biggest trading partner, any further tightening measures from Beijing is viewed as a negative for the Kospi, traders said. Heavyweight Samsung Electronics lost 0.6%, while Utility stocks such as Korea Electric Power and Korea Gas Corp fell 1.6% and 3.4%, respectively. The yen's weakness against both the U.S. dollar and the euro on Tuesday and local media reports that production at Toyota Motor will return to normal sooner than expected supported the Tokyo market. "The market is once again starting to recognize the faster-than-expected recovery of Japan's supply chain," following the devastating March 11 earthquake and tsunami, said Cosmo Securities equity strategist Toshikazu Horiuchi. However, caution ahead of key earnings results eroded some of the early buying. "With major earnings coming up, including Toyota Motor, Hitachi and Nissan Motor, selling seems to accelerate when the Nikkei nears the 10,000 mark," said Toshiyuki Kanayama, a market analyst at Monex. Eighteen of 33 Topix subindexes were higher with Toyota, which is due to release its fiscal year earnings after the closing bell, up 1.8%. Suzuki Motor advanced 2.4% on solid fiscal 2010 earnings, while NEC Corp. jumped 4.1% after issuing a bullish fiscal 2011 outlook. Among the losers, Renesas Electronics eased 0.1% after the firm projected a wider net loss for the year ended March. In Sydney, resources, mining and banking stocks underpinned the market. Among the gainers, Rio Tinto rose 2.2%, Newcrest Mining added 0.9% and Westpac tacked on 0.6%. Namibia-focused miner Extract Resources slumped 6.6% after news on Tuesday that China Guangdong Nuclear Power Holding Co. had withdrawn a GBP756 million offer for U.K.-based Kalahari Minerals. Kalahari's key asset is a near-43% stake in Extract, which is developing the US$1.48 billion Husab uranium deposit in Namibia. Elsewhere in the region, New Zealand's NZX-50 was up 0.7%, Philippine shares were up 0.4%, while Singapore's Straits Times Index rose 0.4%, Thai shares rose 0.9%, Malaysia's KLCI rose 0.8% and Indonesian shares gained 0.4%. In foreign exchange markets, the euro was modestly lower against the U.S. dollar, but a bounce in risk-appetite lent the single currency some support as investors continue to grapple with the Greek debt crisis. Doubts about Greece's ability to work its way out of its travails kept euro-bulls at bay. Junichi Ishikawa, an foreign exchange analyst at IG Markets Securities in Japan, noted heavy sell orders for the euro above the $1.4400 level. "Also, considering how European authorities are having to go all out to quell market speculation over Greek debt restructuring, it's best to take the view that things are still stormy," he said. The euro was at $1.4397 against the greenback, from $1.4409 late Tuesday in New York, and at Y116.43 against the yen, from Y116.54. The dollar was buying Y80.85, from Y80.88. Lead Japanese government bond futures were down 0.02 at 140.64 points, weighed by the Nikkei's rise. The yield on the 10-year cash JGB was flat at 1.130%. June Nymex crude oil futures were up 3 cents at $103.91 per barrel on Globex. Spot gold was at $1,522.60 per troy ounce, up $6.50 from its New York settlement Tuesday. -Shri Navaratnam, Dow Jones Newswires; +65-6415-4142; shri.navaratnam@dowjones.com TALK BACK: We invite readers to send us comments on this or other financial news topics. Please email us at TalkbackAsia@dowjones.com. Readers should include their full names, work or home addresses and telephone numbers for verification purposes. We reserve the right to edit and publish your comments along with your name; we reserve the right not to publish reader comments.

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