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By Tom Miles
HONG KONG, Feb 19 (Reuters) - Asian stocks made a brisk
start on Tuesday as investors, sought undervalued bank shares
and exporters that could gain from a modestly stronger dollar.
Unrelenting supply problems kept the heat under commodities
prices, with oil <CLc1> at around $96 a barrel and platinum
<XPT=>, a precious metal also used in car exhaust systems,
powering to a record high for the 14th day in a row.
U.S. markets were closed on Monday, but European traders
put some faith back in banks after Britain's nationalisation of
Northern Rock <NRK.L>. The DJ STOXX bank sector index <.SX7P>
rose 2.5 percent, helping FTSEurofirst 300 index <> to
close up 2 percent.
"The news of Britain nationalising Northern Rock showed
that a government would step in to stave off a credit crisis in
any form, helping soothe credit market worries," said Won
Jong-hyuk, an analyst at SK Securities in Seoul.
"Though credit market strains and economic growth worries
would likely continue to prevent markets from regaining ground
soon, stocks seem to have pretty much seen a bottom."
Asia followed Europe's lead, with MSCI's measure of Asia
Pacific stocks excluding Japan <.MIAPJ0000PUS> up 1.2 percent
by 0224 GMT and Japan's Nikkei average <> 0.6 percent
higher.
Australian banks also rose, shrugging off minutes from the
latest central bank meeting which showed the bank had
considered a higher rate rise to tackle inflation.
[]
The benchmark S&P/ASX 200 index <> was up 1.1 percent,
in line with Taiwan <> but lagging a 1.7 percent rise in
Hong Kong's Hang Seng <>.
The Korea Composite Stock Price Index <> touched a
one-month high in early trade and was up 0.8 percent.
STEEL
Korea's POSCO Co Ltd <005490.KS>, the world's
fourth-largest steel maker, recovered from Monday's fall as
investors digested its decision to accept a 65 percent jump in
iron ore prices from Brazilian miner Vale.
"The increase is positive for the POSCO stock, because the
amount was within a level which would allow POSCO to pass on
the cost to customers," said Lee Chang-mok, an analyst at Woori
Investment & Securities.
Japanese steel stocks, which had jumped on Monday in relief
at the 65 percent hike, tracked back slightly, shaving 0.3
percent off the Tokyo iron and steel sub-index <.ISTEL.T>.
With U.S. traders observing the Presidents' Day holiday,
the dollar strengthened in thin trade on Monday and held steady
above 108 yen <JPY=> and below $1.467 <EUR=> versus the euro on
Tuesday, buoying export-focused stocks such as Canon Inc
<7751.T>.
"The mood in the market has changed, with sentiment
generally improving for the dollar even when U.S. data remains
weak. Market views are now more mixed than before, when they
were solely focused on dollar selling," said a dealer at a
European bank.
The appetite for stocks ground down demand for Japanese
bonds, which slipped lower in quiet trade.
The Ministry of Finance's 700 billion yen ($6.5 billion)
sale of 15-year floating rate JGBs later on Tuesday expected to
give some direction.
"Poor auction results could spark a bond sell-off. But
other than that, the government bond market is likely to be
more influenced by moves in share prices this session," said
Atsushi Ito, a JGB strategist at Morgan Stanley.
March 10-year JGB futures <2JGBv1> were down 0.08 points at
137.28 by 0220 while the benchmark 10-year yield climbed 1
basis point to 1.460 percent <JP10YTN=JBTC>.
(Additional reporting by Kim So-young in SEOUL; Chikako Mogi
and Rika Otsuka in TOKYO; Editing by Lincoln Feast)
