Asian stocks mostly higher, Japan posts solid growth

Asian shares got off to a positive start on Thursday after data showed Japan's economy accelerated in the first three months of the year, in contrast to an enduring recession in the euro zone which was keeping the euro in the doldrums.

Tokyo's Nikkei touched a fresh 5-1/2 year high, before reversing direction to be down slightly on the day, while MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.2 percent.

Australian shares edged up 0.1 percent and South Korean shares were 0.7 percent higher.

Japan's economy grew 0.9 percent in the first quarter, speeding up from a 0.3 percent pace in the previous quarter and beating expectations for a growth rate of 0.7 percent.

"This is undoubtedly very strong growth, and very positive for Japan's economy," said Yoshiki Shinke, senior economist, Dai-Ichi Life Research Institute in Tokyo.

"It's no longer just about brightening sentiment and rises in equities prices. There's now proof that Abenomics is working and that the economy is on a solid footing."

The report stood in stark contrast to the euro zone, which showed the region contracting for a sixth straight quarter as France slid into recession and Germany registered a mere 0.1 percent growth.

The euro zone data had raised expectations for more monetary easing by the European Central Bank, prompting investors to sell the euro.

The euro fetched USD 1.2881, having fallen more than 0.4 percent to as far as USD 1.2843 on Wednesday. Against the yen, it was at 131.68, off a three-year peak of 132.78 set earlier in the week.

Commodity prices were little changed with Brent crude holding on to gains at USD 103.60, while spot gold eased to a fresh one-month low around USD 1,387 per ounce.