* Japan central bank buys shares from commercial banks
* Australia announces $26.5 billion second stimulus package
* Japan's MUFG stock slips on report to cut profit forecast
* China still top for investors among emerging
markets-EPFR
(Repeats to more subscribers, updates prices, adds comments,
European outlook)
By Kevin Plumberg
HONG KONG, Feb 3 (Reuters) - Asian stocks rose on Tuesday,
helped by a tech sector rally and new measures by Japan and
Australia to support their economies, but sentiment remained
negative amid concerns about plunging company earnings.
The stock market gains undermined government bond prices,
while major European stock markets were expected to open as
much as 1.8 percent higher, according to financial bookmakers.
Japan and Australia unveiled aggressive new measures to
stabilise markets and support their economies, but the moves
gave their stock markets only a brief boost as the growing
number of companies warning about their results suggested the
strength in equities could be fleeting.
Japan's central bank said it would buy $11.2 billion worth
of badly performing shares off the books of the country's
struggling financial institutions, and Australia's government
unveiled a $26.5 billion second stimulus package.
[]
"Hopes for steps to improve the demand and supply balance
of stocks and economic stimulus measures overseas will lend
support to the market, which is deeply undervalued," said
Junichi Misawa, senior fund manager at STB Asset Management in
Japan.
"But the reality is that we still don't see the bottom for
the economy or corporate earnings and that will cap further
gains in the market for a while."
Technology stocks, beaten down in recent weeks, led a
modest rally in equities, which in turn helped investor
willingness to take risks and lifted higher-yielding currencies
such as the Australian and New Zealand dollars.
The MSCI index of stocks in Asia-Pacific excluding Japan
<.MIAPJ0000PUS> rose 1.2 percent. The healthcare, materials and
technology sectors were the biggest percentage gainers among
the sectors in the region.
South Korea's KOSPI index <> was the among the biggest
gainers in the region, climbing 1.4 percent after
better-than-expected results from flash memory drive maker
SanDisk.
In Australia, shares of Commonwealth Bank of Australia Ltd
<CBA.AX> jumped 9.8 percent after the bank delivered a profit
forecast that was not as bad as expected [].
However, the benchmark S&P/ASX 200 index <> managed
only a 0.3 percent rise as big falls in property shares kept
gains in the broader market in check.
Japan's Nikkei share average <> finished 0.6 percent
lower, after rising as much as 2 percent earlier in the
session, as fears about corporate results plagued investors.
Shares of Japan's largest bank slipped 0.8 percent after a
newspaper reported Mitsubishi UFJ Financial Group <8306.T> will
slash its annual forecast and join an increasing number of
companies ratcheting down their expectations as the impact of
global recession is fully felt.
Hong Kong's Hang Seng index <> rose 0.6 percent, helped
by Chinese stocks, which rose on speculation of further
stimulus from Beijing.
BIG GOVERNMENT PAYS OUT
Hopes that the White House will, in addition to pumping
more than $800 billion of stimulus into the economy, also
create a new fund to house bad bank debt have been redirecting
investors' capital back into equity markets.
Last week equity funds around the world saw $1.56 billion
in fresh money, bond funds took in $35 million and money
market funds received $6.8 billion, according to Boston-based
EPFR Global, which tracks $11 trillion in total assets.
Among large emerging markets, investors continued to favour
China.
"Since the New Year there has been a clear split in the
fortunes of the four BRICs markets, with investors gravitating
towards China and Brazil at the expense of Russia and, to a
lesser extent, India. China Equity Funds absorbed $43 million
for the week, the eighth time in 10 weeks they have recorded
inflows," the firm said in a note.
In the currency market, the Australian dollar strengthened
against the dollar and yen, after the Australian government
announced its stimulus package [].
The euro was steady at $1.2841 <EUR=> while the U.S. dollar
was hardly changed against the yen at 89.47 yen <JPY=>.
After rallying overnight on a raft of dour economic
reports, U.S. Treasuries came under pressure during Asian hours
after the Bank of Japan's latest efforts.
The benchmark 10-year note's yield <US10YT=RR>, which moves
in the opposite direction of the price, ticked up to 2.75
percent from 2.72 percent late on Monday in New York.
U.S. crude oil futures recovered to trade 1.4 percent
higher at $40.64 a barrel <CLc1>, after falling nearly 4
percent a day earlier due to economic gloom and after U.S.
refinery workers averted a strike that would have slashed fuel
production.
(Additional reporting by Aiko Hayashi in TOKYO; Editing by
Dhara Ranasinghe)
