By Tom Miles
HONG KONG, Jan 29 (Reuters) - Expectations of a further cut
in U.S. interest rates buoyed Asian stock markets on Tuesday
and sent gold <XAU=> to a record high just short of $930 an
ounce.
Platinum <XPT=> also hit an all-time high, of $1,735 an
ounce, in early Asian trade, while silver <XAG=> commanded
prices not seen for 27 years as expectations of a weaker dollar
added to supply pressure from disrupted output in South Africa.
A majority of Wall Street dealers polled by Reuters
[] expect the U.S. Federal Reserve to cut
benchmark interest rates by 50 basis point on Wednesday.
[]
Hopes of a rate cut drove U.S. stocks higher on Monday,
bolstered by more weak U.S. housing data. Japanese stocks
followed suit on Tuesday.
The Nikkei 225 index <> was up 1.8 percent by 0200
GMT, helped by a yen <JPY=> that softened as traders gained
confidence that the Fed's cutting might give the ailing U.S.
economy a lift. Jobless and household spending data also kept
the picture bleak for Japan's own economy and the yen.
[]
"This is simply a rebound, though a softer yen is helping.
The Japanese market has recently been moving entirely in
response to external factors," said Masaru Hamasaki, a senior
strategist at Toyota Asset Management.
"The situation in America is likely to improve, helped by
stimulus measures for the economy. Even so, Japanese stocks are
unlikely to advance on their own due to a cool investor
attitude toward the market."
Among the gainers were consumer electronics makers Victor
Co of Japan (JVC) <6792.T> and Funai Electric Co Ltd <6839.OS>,
both up 5 percent after a newspaper said the two planned to
form an alliance to jointly develop and supply LCD TVs.
[]
The Korea Composite Stock Price Index <> also gained,
but an early surge withered to a 0.4 percent rise by 0203 GMT.
MSCI's measure of Asia Pacific stocks excluding Japan
<.MIAPJ0000PUS> was up 0.2 percent by 0207 GMT.
"Expectations for further (U.S.) rate cuts are lifting
markets, but whether the market could sustain the gains, it's
up to a series of U.S. economic data due soon," said Lee
Kyung-soo, an analyst at Daewoo Securities.
"Markets look likely to extend a roller-coaster ride, at
least in the first half (of 2008) when more dismal news about
the U.S. economy is expected to be released."
Australia's benchmark S&P/ASX 200 index <> was down
1.5 percent percent by 0210 GMT after traders returned from
Monday's public holiday and took profits following Friday's 5
percent gain, the biggest one-day percentage gain in over a
decade.
"Today will just be a consolidation day after big gains
from late last week," said Don Williams, chief investment
officer with Platypus Asset Management, which oversees about
$1.3 billion.
The prospect of a Fed cut, which could weaken the dollar
and give a shot in the arm to the U.S. economy, also helped oil
<CLc1> tick up 26 cents to $91.25 by 0214.
"The big question is: has the U.S. market bottomed out, and
whether the physical stimulus is enough," said Tony Nunan of
Mitsubishi Corp in Tokyo.
Japanese government bond futures prices fell as the stock
market firmed, with the benchmark 10-year bond yield
<JP10YTN=JBTC> rising 5 basis points to 1.455 percent by 0245
GMT, staying well above last week's 28-month low of 1.310
percent.
"The stock market is the main driver now, and the bond
market has no choice but to follow," said Koji Ochiai, senior
market analyst at Mizuho Securities.
