By Tom Miles
HONG KONG, Feb 12 (Reuters) - Investors snapped up stocks
on Tuesday that showed promise of weathering a downturn as U.S.
economic worries weighed on equity markets and supply problems
kept commodity prices close to record highs.
Financial bookmakers in London expect Britain's FTSE 100
<> index, the German DAX <> and the French CAC 40
<> to open around 0.6 percent higher.
In Asia, MSCI's index of Asian stocks outside Japan
<.MIAPJ0000PUS> was up 0.9 percent at 0230 GMT, while the Tokyo
market, back from a holiday on Monday, ended flat.
U.S. Federal Reserve Chairman Ben Bernanke is due to
testify before Congress on Thursday on the state of the world's
biggest economy. Stock markets are sensitive to any news on the
threat of a U.S. recession or fallout from the credit crisis.
"There seems to be no good macroeconomic news to expect for
now. The question is more when the bad news already out there
would start to subside," said Kang Mun-seok, an analyst at
Korea Investment & Securities in Seoul.
"February would likely mark a period when markets see a
bottom and stabilise, but a significant rise would come much
later."
Growth concerns weighed on the euro as traders speculated
whether slowing European economic momentum would warrant a rate
cut by the European Central Bank even as inflationary pressures
remain high.
But markets for oil and metals, buoyed by Asia-driven
demand, remained focused on threats to supply, driving crude
oil <CLc1> to a one-month high on Monday and platinum <XPT=> to
a record high on Tuesday. []
Crude, which rose 2 percent on Monday following a threat by
Venezuelan President Hugo Chavez to halt oil shipments to the
U.S. over a legal row with Exxon Mobil Corp <XOM.N>,
backtracked 31 cents to $93.28 a barrel in Asian trade.
Copper prices <MCU3> also ticked higher in thin trade as
dealers braced for the return of Chinese buyers, who had been
out of the market during a week-long Lunar New Year holiday.
That helped lift stocks of mining giants Rio Tinto <RIO.AX>
and BHP Billiton <BHP.AX>, ramping the Australian stock market
up to a positive close and reversing the previous day's losses.
Australian banks also rebounded, driving the benchmark
S&P/ASX 200 index <> to close up 1.3 percent.
"When you get the resources and the banks firing, you're
going to have a very good day on the main index," said Michael
Heffernan, senior client adviser at Austock Stockbroking.
U.S. PRESSURE
Japanese <> and South Korean <> stocks limped
over the gain line, rising 0.04 percent and 0.2 percent
respectively, as individual stocks showing recession-proof
order books offset losses from those expected to lose in a
slowing global market.
In Japan, high-tech firm TDK Corp <6762.T> and oil explorer
Inpex Holdings Inc <1605.T> were offset by steep falls in
insurance shares such as Millea Holdings Inc <8766.T>, sold
heavily after American International Group Inc <AIG.N> warned
of further subprime losses on Monday. []
Taiwan's main TAIEX index <> slid 1.6 percent as
traders back from a week-long holiday caught up with U.S.
market falls.
"It's not easy to see a rally in local stocks in the near
term if we continue to feel pressure from the U.S.," said Jih
Sun Investment Consulting analyst Kevin Chung.
With equity investors wavering, bonds stood to gain, but
traders kept their powder dry ahead of the Fed.
"Bond investors are nervously sitting on the sidelines for
now as recent price actions were very choppy and it is hard to
find a good time to enter the market," said a senior trader at
a U.S. investment bank. "They are waiting for the retail data
and comments from Bernanke."
But Japanese government bond [] buyers were reluctant to
jump in before the March 31 fiscal year end, dealers said.
The dollar was trading little changed at 106.9 yen <JPY=>
while the euro <EUR=> slipped to the day's low of $1.4497.
(Additional reporting by Miranda Maxwell in SYDEY, Elaine Lies
and Satomi Noguchi in TOKYO, Kim Soyoung in SEOUL; Editing by
Neil Fullick)
