The optimistic mood was reinforced by data showing higher consumer confidence in the United States. The Conference Board's consumer confidence index showed a reading of 102.3 in December, up from a revised 92.6 in November, well above market expectation.

Technology stocks throughout the region were also well supported amid expectations of strong sales following reports indicating improved Christmas spending in the U.S.

Even the Thai stock market performed relatively well, given the catastrophe that struck the country. After an initial sell off, the market recovered and by the end of the week the Stock Exchange of Thailand Index was down only 0.3 percent on the week, at 668.10. The market closed early Thursday and will only reopen Tuesday.

Stock Exchange of Thailand President Kittiratt Na Ranong said the tsunamis were likely to affect the Thai stock market only in the short term because the economy remains fundamentally sound.

Tourism-related stocks were the hardest hit, but shipping and construction stocks were in play on hopes they will benefit from the reconstruction work needed after the tsunami swept Phuket coast.

TAIWAN

The market closed the year at 8-month closing high on Friday, with the benchmark TAIEX share index at 6,139.69, up 2 percent on the week.

Investor's buy interest fell on the banking sector, which is expected to see a new wave of mergers and acquisitions in 2005. Potential takeover targets are Chang Hwa Bank and Taiwan Business Bank.

Tech shares, especially display screen makers, remained in favor.

Yet, the market also remains cautious as investors watched China's deliberations on an anti-secession law aimed at Taiwan. China's top lawmakers have praised a draft anti-secession law that they said was aimed at peaceful reunification with Taiwan and unanimously suggested it be submitted for deliberation at a parliament session in early 2005.

Taiwan has condemned the legislation as an attempt by China to provide a legal basis to attack the self-ruling democratic island.

KOREA

The market finished trading for the year Thursday at an eight-month high with the Korea Composite Stock Price Index (KOSPI) closing at 895.92, up 1.8 percent on the week.

The market momentum seems to have been fueled by the window dressing of institutional investors, a strategy used near the year's end to improve the appearance of a portfolio or fund's performance.

Interest was noted in blue chips like LG, Samsung Electronics and Hyundai Motor Group.

Ailing credit card company LG Card rose after its former parent group said it will commit up to $254 million in additional capital to save the company from liquidation.

Investors are optimistic about the stock market prospect next year, despite the anticipated weakening of the economy.

HONG KONG

The blue-chip Hang Seng Index ended a short New Year's Eve session at 14,230.14, up 0.2 percent on the week and up 13.15 percent on the year.

Analysts are expecting the market to rise further in 2005, possibly by another 10 percent, especially as appetite for initial public offerings from mainland companies are expected to remain strong.

This week, property shares continued to outperform on optimism on strong consumer confidence next year.

Index heavyweight Hutchison also attracted buying interest as investors believe the 3G outlook is turning more positive.

SINGAPORE

With many fund managers on the sideline for the Christmas holidays, retail investors dominated activity and picked on penny stocks on bargain hunting.

The Straits Times Index closed Friday at 2,066.14, up 0.5 percent on the week and up 17 percent on the year.

Banks, which had fallen Monday amid worries of the quake's economic impact regained ground.

Creative Technology attracted buying interest after upgrades by several analysts on news its digital music players were selling well in the U.S.

MALAYSIA

The tsunami, which hit some part of Malaysia like the northern resort island of Penang, cast some shadow over activity, although the market held well overall as investors believe the country's economy will not be affected much by the catastrophe. Indeed, tourism-related stocks barely moved.

Low-cost carrier AirAsia lost ground, but traders said it was more because of the worse-than-expected first-quarter results it reported last week.

By the end of the week, the main index stood at 907.43, virtually unchanged on the week, but up 14 percent on the year.