Oct. 18 (Bloomberg) -- Asian stocks gained for the first time in three days, led by Japanese banks, after JPMorgan Chase & Co. reported profit that beat analyst estimates. BHP Billiton Ltd. climbed after the mining company said the outlook for metals ``remains positive.''

Mizuho Financial Group Inc. rose after a six-day slide and National Australia Bank Ltd. advanced on speculation banks can weather the worst U.S. housing slump since 1991.

Hong Kong's benchmark hit 30,000 for the first time after China Securities Regulatory Commission Vice Chairman Tu Guangshao said yesterday authorities are studying a plan to allow arbitrage between mainland and city-listed shares. Liu Fuhua, a spokesman for the regulator, said late today that Tu ``misspoke,'' declining to confirm whether such a plan is being considered.

``While the problems in the U.S. housing market will probably linger, the worst is over for financial stocks,'' said Shane Oliver, who helps manage $83 billion at AMP Capital Investors in Sydney. He said although it remains to be seen how China would implement such an arbitrage plan, it would ``put upward pressure on Hong Kong stocks, especially those with dual listings.''

The Morgan Stanley Capital International Asia-Pacific Index added 0.9 percent to 166.88 at 7:12 p.m. in Tokyo, halting a two- day, 2.1 percent slide. Japan's Nikkei 225 Stock Average gained 0.9 percent to 17,106.09.

China's CSI 300 Index lost 3.6 percent, the most in five weeks, while India's Sensitive Index slid 3.8 percent. Benchmarks also fell in Singapore, India, Indonesia, Thailand and New Zealand.

Acer Inc., the world's fourth-largest personal-computer supplier, climbed in Taipei after researcher IDC said its shipment growth outpaced bigger rivals. Hynix Semiconductor Inc., the world's No. 2 memory chipmaker, slipped after saying profit fell for a second straight quarter.

Banks Rebound

Most U.S. stocks rose yesterday, helping the Standard & Poor's 500 Index advance for the first time in three days. JPMorgan, the third-biggest U.S. bank, said third-quarter net income rose 2.3 percent to $3.4 billion, or 97 cents a share. The average analyst estimate in a Bloomberg survey was 90 cents.

Mizuho, Japan's second-largest publicly traded bank, jumped 3.8 percent to 630,000 yen, its first advance since Oct. 9. Mitsubishi UFJ Financial Group Inc., the No. 1, gained 2.3 percent to 1,040 yen, also climbing for the first time since Oct. 9. National Australia Bank, the country's biggest, added 1.6 percent to A$41.29 after yesterday sliding to the lowest since Oct. 4.

Wells Fargo & Co., the biggest U.S. bank on the country's west coast, said this week net credit losses totaled $892 million last quarter. Citigroup Inc. on Oct. 15 reported a 57 percent drop in its third-quarter profit, while Nomura Holdings Inc., Japan's largest brokerage, said it will post its first quarterly pretax loss in more than four years.

`Some Relief'

``JPMorgan was better than expected so that's given some investors in the financials some short-term assurance,'' said Steven Marsh, who helps manage the equivalent of $632 million at Trust Co. in Sydney. ``There's some relief.''

Meanwhile, a Commerce Department report yesterday showed housing starts in the U.S. slid 10.2 percent in September to an annual rate of 1.191 million, a 14-year low. That may strengthen the case for the Federal Reserve to cut interest rates again to keep the economy's six-year expansion alive, economists say.

BHP Billiton, the world's biggest mining company, added 3 percent to A$47.70. Rio Tinto Group, the third largest, gained 2.6 percent to A$112.83. Jiangxi Copper Co., China's No. 2 producer of the metal, advanced 4.1 percent to HK$30.75 in Hong Kong.

Supply and demand for copper are favorable and the iron ore market remains tight, BHP Chief Executive Marius Kloppers said today. ``The outlook for the short and long term remains positive,'' he said.

Kloppers is planning $50 billion of projects to boost production of oil, copper and iron ore to meet rising demand led by China, buyer of a fifth of the company's products. BHP reported an eighth consecutive record profit in August.

Hang Seng Touches 30,000

Hong Kong's Hang Seng Index jumped as much as 2.5 percent to 30,025.07 and closed 0.6 percent higher at 29,465.05. The Hang Seng China Enterprises Index, a measure of 43 so-called H shares of Chinese companies, surged as much as 5 percent, and ended the day up 1 percent.

Tu said yesterday in Beijing yesterday that a panel is studying a proposal to allow arbitrage between companies traded on domestic and Hong Kong exchanges. The securities regulator said late today that he misspoke. C.K. Chan, a spokesman for Hong Kong's Securities and Futures Commission, declined to comment on such a plan.

Limits on inward and outward investment have helped China's CSI 300 almost triple this year, making the Hong Kong-traded shares of Chinese companies a cheaper alternative for investors. The benchmark is valued at an average 55 times reported earnings, compared with 31 times for the Hang Seng China Enterprises.

Positive for H Shares

Aluminum Corp. of China Ltd., the nation's biggest producer of the metal, rose 2.9 percent to HK$24.80 in Hong Kong. Bank of Communications Ltd., China's fifth-largest bank, jumped 7.1 percent to HK$11.72. China Life Insurance Co., the No. 1 insurer, added 0.9 percent to HK$51.30.

``It's clearly positive for H shares and Hong Kong in general,'' said Howard Wang, who manages the $1 billion JF Greater China Fund in Hong Kong.

China's CSI 300 Index lost 3.6 percent. Aluminum Corp. of China, also known as Chalco, slid 6.2 percent to 52.72 yuan in Shanghai, where the stock trades at 49 times reported earnings. Chalco's Hong Kong-traded stock has a multiple of 23 times.

Bank of Communications dropped 3.6 percent to 14.82 yuan. The shares trade at 55 times, compared with 35 times in Hong Kong. China Life's mainland stock, which is valued at 55 times earnings, lost 1.8 percent to 67.98 yuan. Its shares have a multiple of 40 in Hong Kong.

If regulators approve such a plan, ``the A-share market would become bearish,'' said Mo Fan, an analyst at Soochow Asset Management Co. in Shanghai.

Acer, Hynix

Acer jumped 6.5 percent to NT$67, its biggest advance since Aug. 20. IDC said the Taipei-based company's worldwide shipments increased 59 percent in the third quarter, the fastest pace of growth among the world's top five PC makers.

Hynix Semiconductor dropped 2.6 percent to 26,100 won, its lowest close since December 2005.

Third-quarter net income slid 56 percent to 168 billion won ($183 million), the company said today, missing the median analyst estimate in a Bloomberg News survey by more than 50 percent.

Acer Inc. (2353 TT)
Aluminum Corp. of China Ltd. (2600 HK)
Bank of Communications Ltd. (3328 HK)
BHP Billiton Ltd. (BHP AU)
China Life Insurance Co. (2628 HK)
Hynix Semiconductor Inc. (000660 KS)
Jiangxi Copper Co. (358 HK)
Mitsubishi UFJ Financial Group Inc. (8306 JT)
Mizuho Financial Group Inc. (8411 JT)
National Australia Bank Ltd. (NAB AU)
Rio Tinto Group (RIO AU)

To contact the reporter on this story: Chen Shiyin in Singapore at schen37@bloomberg.net

Last Updated: October 18, 2007 06:15 EDT