Asia stocks up as takeover talk in US drives Dow

BANGKOK (AP) - Asian stock markets picked up stream on Wednesday, driven higher by reports that another big corporate takeover might be in the works in the United States.

A report that two major office supply retailers are in talks to combine their businesses sent the Dow Jones industrial average to a near-record high Tuesday. That news came on top of an US$11 billion (S$13.6 billion) tie-up between American Airlines and US Airways, announced earlier this month, that will create the world's biggest airline.

Japan's Nikkei 225 rose 0.7 per cent to 11,451.33. The index briefly topped 11,500 for the first time since late 2008. South Korea's Kospi advanced 1.4 per cent to 2,014.28. Hong Kong's Hang Seng added 0.3 per cent to 23,220.59. Australia's S&P/ASX 200 rose 0.4 per cent to 5,101.60.

The Dow Jones industrial average rose 53.91 points to close at 14,035.67. The S&P 500 index rose 0.7 per cent to 1,530.94. The Nasdaq composite rose 0.7 per cent to 3,213.59. That's despite the $1.2 trillion in automatic federal spending cuts that are scheduled to start March 1 unless Congress and the White House find a way to avoid them. Previous budget battles in Washington have rattled financial markets.