* Shares fall on worry about U.S. stimulus, bank plan
* Uncertainty about what to expect from bank plan weighs
* Euro falls 1 pct after report on Russian private debt
(Repeats to more clients, updates prices throughout, adds
Russian government denial of corporate debt restructuring
talks)
By Elaine Lies
TOKYO, Feb 10 (Reuters) - Asian stocks fell on Tuesday as
uncertainty grew about U.S. plans for a bank bailout, while the
euro fell on a report that Russian banks were seeking a delay
on repayment of loans.
European shares were set to fall after Swiss bank UBS
<UBSN.VX> posted a huge fourth-quarter loss and as U.S. stock
futures fell on concerns about the U.S. bank rescue plan.
Dow Jones industrial stock futures <DJc1> shed 0.9 percent
and S&P stock futures <SPc1> lost 1 percent, a sign that Wall
Street may fall later in the day.
Japan's Nikkei business daily said Russian banks would ask
Moscow to renegotiate with European and other foreign banks to
postpone repayment on up to $400 billion of loans, sending the
euro tumbling against the dollar and yen. []
A Russian government spokesman later said it was not
considering a corporate debt restructuring and was not in talks
with foreign banks on the issue. []
The euro pared some losses but still remained 1 percent
down at $1.2877 <EUR=> and 117.75 yen <EURJPY=>.
Investors were spooked by conflicting reports about the
U.S. bank bailout and the fate of a "bad bank" to buy
distressed assets from commercial banks as part of a financial
rescue package. []
Three sources briefed on the plan, which is set to be
announced at 1600 GMT on Tuesday, told Reuters it included a
public-private partnership that could buy up to $500 billion of
distressed assets, but not a standalone government "bad bank".
[]
"It's starting to seem as if the economic stimulus plan
will be approved one way or another, but the bank bailout is
really important, and this uncertainty is growing," said
Takashi Ushio, head of the investment strategy division at
Marusan Securities.
"What sort of partnership? Will the $500 billion be enough?
There's a lot of unknowns that make it hard to trade at this
point, though at the very least it does seem as if the
government may abandon the idea of handling the 'bad bank' on
its own."
A "bad bank" would remove soured assets which are
contaminating banks' balance sheets, freeing them up to lend
again, but the expected use of taxpayers' money and fears of
further losses have made the issue highly politically charged
for President Barack Obama.
Wall Street finished flat on Monday as traders' anxiety
grew after the announcement of the bank plan was postponed by a
day.
An $838 billion economic stimulus bill passed a key
procedural hurdle in the U.S. Senate on Monday, paving the way
for the chamber to pass the bill on Tuesday. But then final
negotiations must begin with the House of Representatives --
whose own bill is priced at $819 billion -- on a compromise
bill. []
Japan's Nikkei share average <> fell 0.29 percent,
shedding early gains as the yen climbed against the euro on the
Russian debt restructuring report and as uncertainty grew over
the U.S. bank rescue plan.
However, Nissan Motor Co <7201.T> surged 7.3 percent after
it announced drastic steps on Monday to cope with the
recession, saying it would cut 20,000 jobs. It joined a growing
list of automakers warning of red ink this year. []
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> fell 0.9 percent.
Hong Kong's Hang Seng <> was up 0.4 percent after
extending gains on Monday to its longest rally in two months,
while shares on the Shanghai bourse <> rose 1.8 percent.
South Korean shares <> fell 0.3 percent as the
government acknowleged for the first time that it expected
Asia's fourth-largest economy to shrink this year.
[]
RUSSIA WOES
Foreign exchange markets remained skittish despite Russian
denials that the government and banks were in talks to help
companies restructure foreign debt.
A banking industry official told Reuters no proposal had
been submitted to the government, but said bankers had
discussed a restructuring plan for corporate debt at a meeting
last week. []
"As banks in Europe have a close relationship with Russia,
the report raised worries about their losses which hurt the
euro," said Yuichiro Nakamura, a dealer at Shinkin Central
Bank.
The Australian dollar <AUD=> retreated from three-week
highs as worries about global economic stability resurfaced and
a dismal business confidence survey reaffirmed the risk of a
recession at home. [].
The yield on the benchmark 10-year U.S. Treasury note eased
almost 1 basis point to 2.98 percent <US10YT=RR>. Treasury debt
prices fell on Monday, taking benchmark yields to their highest
levels in over two months.
Japanese government bond futures <2JGBv1> edged down 0.14
point to 138.42.
Oil prices held below $40 a barrel, pausing after an
overnight decline as investors awaited progress on the U.S.
economic stimulus package. <CLc1> []
Gold eased, extending the previous day's fall of almost 2
percent to trade at $894.40 an ounce <XAU=>.
(Additional reporting by Aiko Hayashi in Tokyo; Editing by Kim
Coghill)
