(Refiling to add dropped word in second paragraph)
By Rafael Nam
HONG KONG, March 19 (Reuters) - Asian stocks surged on
Wednesday as big U.S. interest rate cuts and surprisingly
resilient results from two top U.S. investment banks revived
financial shares that had suffered heavy losses.
But the dollar eased somewhat -- a day after posting its
biggest one-day gain against the yen in a decade -- as Japanese
exporters rushed to sell, though it remained well above recent
lows hit against other currencies.
Gold and bonds also slid as their recent safe-haven appeal
dimmed, while oil retreated from a jump on Tuesday.
Analysts warned against over-reacting to what has been a
volatile week, with Asian stocks just on Tuesday hitting their
lowest since August amid investor fears of the impact of the
financial crisis on the global economy.
"The Fed is showing strong leadership in addressing these
issues they are having and the market is being buoyed by the
fact that it is willing to move fairly quickly," said Tony
Russell, senior equities adviser at ABN AMRO Morgans in
Australia.
"It's very good to see a strong bounce to the market but I
don't think we're out of the woods just yet."
The MSCI's measure of Asian stocks outside Japan
<.MIAPJ0000PUS> rose 2.1 percent as of 0105 GMT.
The Federal Reserve slashed U.S. interest rates on Tuesday
by a hefty three-quarters of a percentage point. The cut was
less than many traders had expected but comes on the heels of
emergency measures over the weekend to ease the liquidity
crisis in credit markets. []
The Fed has now cut rates by an aggressive 3 percentage
points since mid-September, including 2 points since the start
of the year.
Before the move, investors had reacted with jubilation
after Goldman Sachs <GS.N> and Lehman Brothers <LEH.N> had
topped forecasts, although their quarterly profit had more than
halved. []
The news was well received by investors who had fretted
about more casualties from the credit crisis following the fire
sale of Bear Stearns <BSC.N> to JPMorgan Chase <JPM.N> on
Sunday.
Shares in Asian financial firms such as South Korea's
Kookmin Bank <060000.KS> and Japan's Mitsubishi UFJ Financial
Group <8306.T> surged.
Though regional banks have been spared the extent of
writedowns seen at European and U.S. counterparts their shares
have suffered from the spreading credit crisis.
Japan's Nikkei <> rose 3 percent, coming back after
hitting its lowest since August 2005 on Monday, while shares in
Australia also gained 3 percent.
Shares in South Korea <> and Singapore <.FTSTI> rose
well above 2 percent each, while Taiwan <> was up nearly 2
percent.
DOLLAR EASES
The dollar eased from a rally on Tuesday when traders had
reacted to the Fed's slightly smaller-than-expected cut in U.S.
interest rates by sending the greenback to its biggest one-day
against the yen in nine years.
The U.S. currency fell as low as 99.39 yen before
recovering to 99.55 yen <JPY=>, down 0.3 percent from late U.S.
trade.
Some of the willingness to take riskier bets returned, with
gold down more than 2 percent to a low of $980.80 an ounce. It
last traded at $987.70, down from a record $1,033.90 on Monday.
Japanese government bond futures slid as well, with June
futures <2JGBv1> down 0.24 points to 140.76.
Oil prices retreated after jumping 3.5 percent on Tuesday
ahead of U.S. government data expected to show rising crude and
gasoline inventories in the United States.
U.S. crude for April delivery <CLc1> fell $1.23 to $108.19
a barrel by early Asian trade.
