Nikkei surge leads Asian markets higher

The Nikkei 225 index has recorded its strongest monthly advance in more than a year today (October 20th), leading a recovery in Asian markets.

This came after a series of positive data releases in the US helped to ease fears over the health of the global economy and boosted trading confidence.

Above-estimate housing starts figures were accompanied by a report showing the Thomson Reuters/University of Michigan index of consumer sentiment reached its highest level in more than seven years earlier this month. 

In addition, some strong corporate earnings results from major American corporations further calmed investors, while Apple and Texas Instruments are among those set to deliver their latest updates later today.

Amid this renewed confidence, the Japanese yen weakened in forex trading markets, lifting exporters such as Toyota and Honda. The Nikkei was also supported following reports Japan's $1.2 trillion (£745 billion) public pension fund is set to increase its holdings of domestic equities. 

Currently, the GPIF fund has a local allocation of 12 per cent, but anonymous sources told Reuters that a weighting in the middle of the 20-30 per cent range is likely. 

The Nikkei 225 soared by 3.98 per cent to end the session at 15,111.23 points - recouping most of the losses endured by the Japanese benchmark index last week.

Following reports the People's Bank of China may be set to inject further stimulus into the country, the Shanghai Composite added 0.6 per cent to recover from the three-week low reached on Friday. In Hong Kong, the Hang Seng gained 0.31 per cent.

Australia's ASX 200 extended its recent rally into a third successive session, rising by 0.9 per cent to reach its highest level since October 1st. This came after comments from Reserve Bank of Australia assistant governor Christopher Kent indicated current monetary policy will support the country's economic growth.