Asian Shares Gain

Asian stock markets were higher on Wednesday after Moody's reaffirmed its rating on Spanish debt, helping Australian and Hong Kong shares hit multi-month highs.

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Regional market sentiment improved after Moody's Investors Service affirmed Spain's government bond rating - keeping the country's government debt rating at Baa3, one notch above junk territory, with a negative outlook. The ratings agency had launched a review into a possible downgrade in June, and its conclusion removed an overhang for market sentiment.

The euro was higher at $1.3111 in late Asian trading, compared with $1.3054 late Tuesday in New York, adding to its 0.8% rise overnight.

There was also some positive news from the U.S., where Wall Street finished higher after data showed that confidence for home builders reached its highest level in October since 2006.

"The U.S. economy looks as though it is about to re-accelerate, which is good news for the global economy," said Tim Schroeders, fund manager at Pengana Capital in Melbourne, which manages assets worth around $1 billion.

The main risk events for the week have yet to happen. On Thursday, China will release its growth numbers for the third quarter, a data point that will be scrutinized to assess the health of the Chinese economy. Also on Thursday, a summit of European leaders is scheduled to start, which will be examined for further progress on the region's ongoing debt crisis.

U.S. earnings were in focus after Johnson & Johnson posted slightly better-than-expected third-quarter earnings, while chipmaker Intel's profit fell and IBM's third-quarter revenue declined.

The poor technology results led Japanese semiconductor names to underperform. Advantest Corp. fell 2.2% and Tokyo Electron slipped 0.3%.

The dollar weakened against the yen in late Asian trading, taking a breather after its 0.9% rise over the last four sessions. The greenback was at ¥78.73 compared with ¥78.89 late Tuesday, but retained some of its 0.3% overnight gain.

Japan's Nikkei Stock Average was 1.2% higher at 8806.55, helped by Softbank Corp., which continued to recover from the sell-off late last week sparked by news that the company will acquire a 70% stake in Sprint Nextel . Softbank ended up 5.6%.

South Korea's Kospi Composite was 0.7% higher at 1955.15, as the dollar weakened against the Korean won - the greenback was at KRW1104.97. The stronger local currency helped boost airlines and builders: Korean Air Lines was up 3.2% and shipbuilder Hyundai Heavy Industries climbed 2.1%.

Australia's S&P/ASX 200 ended up 0.8% at 4528.20 after touching a 15-month high of 4536.80, with a strong performance from mining stocks: Rio Tinto rose 1.7% and BHP Billiton was 1.2% higher.

In China, the Shanghai Composite was up 0.3% at 2105.62 in cautious trading ahead of Thursday's growth data.

"The macroeconomic data that was already published is mixed, and eyes are now on Thursday's data, which could show that the overall economy is bottoming out. But a strong rebound isn't likely," said Li Xiaoxuan, from Shenyin Wanguo Securities.

Hong Kong's Hang Seng Index rose 1% to 21416.64, its highest level since March. The index climbed for the eleventh out of the last thirteen sessions with broad-base gains. Aluminum Corp. of China was one of the best performers, up 3.5%, benefiting from the risk-on sentiment.

Sportswear brand Li Ning dropped 4.8% in Hong Kong, on news that it is selling 25% of the company to sports talent firm Viva China Holdings, as the brand makes moves to overhaul its business in the sportswear market amid tough competition.

Write to Daniel Inman at daniel.inman@wsj.com