* Euro higher, but caution likely ahead of Portugal debt
auction
* Asia stocks rise across the board
* Gold stronger on euro zone fears
By Nick Macfie
SINGAPORE, Jan 12 (Reuters) - The euro rose against the
dollar on Wednesday, along with Asian stocks, but caution
towards the currency is likely to set in ahead of key bond
sales by highly indebted euro zone members Portugal and Spain.
Currency traders have their eyes on Portugal's first debt
auction of the year later in the day, when it is due to tap
bond investors for around 1.5 billion euros, while Spain is
seeking up to 3 billion euros on Thursday.
Markets are keen to see if they will be able to fund
themselves at a sustainable cost or be forced to turn to the
European Union and IMF for financial aid.
But the common currency was still enjoying some reprieve
after euro zone sources said the region's finance ministers
were likely next week to consider the option of raising the
effective lending capacity of the currency's bloc's rescue
fund as part of efforts to calm jittery markets. []
This followed Japan's promise to support an upcoming euro
zone bond sale and talk that the European Central Bank bought
debt to help stabilise markets.
The euro was trading around $1.3015 to the dollar.
On Monday, the euro plumbed a four-month trough around $1.2871.
"The Portuguese (debt) auction will probably go quite well
and that'll likely give the euro a bump up ... temporarily,"
said Joseph Capurso, a strategist at Commonwealth Bank, late
on Tuesday.
"The bottom line is they're going to be paying something
like 7 percent on their 10-year debt and that's probably more
than they can afford. There is a very high chance they'll have
to seek some sort of assistance from European partners and
that'll push the euro back down again."
Asian shares were higher on the back of gains on Wall
Street and solid earnings reports with Tokyo's benchmark
Nikkei index up 0.5 percent at an eight-month high.
The MSCI index of Asia Pacific stocks ex-Japan
was up 0.3 percent.
The Dow Jones industrial average rose 0.3 percent
on Tuesday. The Standard & Poor's 500 Index added 0.4
percent. The Nasdaq Composite Index gained 0.3 percent.
Crude oil prices <CLc1> climbed above $91 a barrel as a
key Alaskan pipeline remained shut and on colder weather,
lifting shares of energy producers but limiting gains of
transportation and consumer-related stocks.
Gold rose more than $5 to $1,385.36 an ounce, below
its historical high of around $1,430 struck in December but
still buoyed by high oil prices and the euro zone crisis, both
of which help promote gold's image as a safe haven.
(Additional reporting by Ian Chua in Sydney; Editing by Alex
Richardson)
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