* Asian shares at new 2009 high on global manufacturing
data
* Other riskier assets falter: oil lower after Monday rally
* Government bonds sold-off; auctions eyed in Japan
By Rafael Nam
HONG KONG, June 2 (Reuters) - Improving global
manufacturing data lifted Asian shares on Tuesday, bringing a
regional index near to levels before the collapse of Lehman
Brothers in September, but the pace of gains slowed as
investors weighed how much longer a heady, three-month rally
will last.
The gains come after reports on Monday showed contractions
in manufacturing activity in the United States, the euro zone
and the United Kingdom last month had eased, while China saw
factory activity expanding for a third consecutive month.
[]
The reports reinforced expectations the worst in the global
economy is over, while the widely expected bankruptcy filing by
General Motors <GM.N> on Monday removed another major risk
factor hanging over financial markets, at least in the
near-term. []
However, some of the other riskier asset classes which rose
on Monday steadied in Asia on Tuesday, highlighting investor
caution after a steady run-up in prices.
U.S. crude futures <CLc1> fell on Tuesday but held above
$68 a barrel as investors took profits from a jump of more than
3 percent the day before which carried oil to its highest
level
since early November.
Safe-havens such as the dollar also steadied on Tuesday
after falling in the previous session.
"A recovery is well underway and the market is following
positive economic news," said Brian Eley, fund manager with
Eley Griffiths, which oversees about A$500 million ($406
million) in Australia.
"In the initial phase, materials, energy and cyclical
stocks will show the strongest moves," he added.
The MSCI index of Asian stocks outside Japan
<.MIAPJ0000PUS> rose 0.9 percent after earlier in the day
hitting its highest since Sept. 29, just weeks after the
Lehman's catastrophic collapse. The gain was modest when
compared to the combined 5.2 percent jump in the previous two
sessions.
The index has now surged some 65 percent from lows in early
March, spurred by signs of stabilisation in the battered
banking sector and credit markets, and by hopes that the global
downturn was bottoming out.
The MSCI index is not far off the levels of Sept. 12, the
Friday before Lehman collapsed, sparking a rout in global
markets.
Japan's Nikkei average <> advanced 0.9 percent, at one
point hitting its highest since Oct 8, while Australia <>
and Taiwan <> rose more than 1 percent each.
However, some other gauges faltered. Hong Kong <>
shares were down 0.8 percent, dragged down in part by a 2.9
percent fall in shares of Industrial and Commercial Bank of
China <1398.HK> after Goldman Sachs was seen selling a stake in
the Chinese lender. []
U.S. stock futures <SPc1> posted modest losses of about
0.15 percent after Wall Street jumped 2-3 percent overnight on
recovery hopes. []
BETTER DAYS
Recent economic data appear to show the global economy has
hit bottom, as evidenced by easing pain in the manufacturing
sector shown by Monday's reports.
On Tuesday, Australia reported a lower-than-expected
current account deficit in the first quarter, while signs of
momentum in the export sector fueled hopes that the country
dodged a recession last quarter. []
But questions remain over the timing and strength of any
recovery.
Policymakers are wary of overconfidence. Japanese Finance
Minister Kaoru Yosano said on Tuesday the world's
second-largest economy has already hit bottom but a full
recovery may not come until spring next year, []
That caution is also being reflected by central banks
worldwide, which after sharply cutting interest rates are now
mostly on hold and eager to keep their options open.
The dollar, which has been whipped recently by investors'
preferrence for higher-yielding assets and concerns about
rising U.S. debt levels, steadied against a basket of major
currencies <.DXY> at 79.144.
The U.S. currency had hit a new low for the year on Monday.
Commodity-linked currencies have especially outperformed on
hopes that demand will soon pick up again. The Australian
dollar <AUD=D4> held above 81 cents to the dollar near
eight-month highs ahead of a decision by the central bank on
interest rates.
Japanese government bonds, however, took a hit, as
investors looked to higher-risk assets which offered the
prospect of stronger returns. The yield in the 10-year note
<JP10YTN=JBTC> climbed 3 basis points to 1.510 percent, its
highest in nearly 7 months.
Yields rose in Japan ahead of Tuesday's 10-year auction
<TENDER01> and tracked a sell-off in U.S. Treasuries on Monday
that led the gap between two-year and 10-year Treasury notes to
match the previous record high hit on Friday of 275 basis
points.
Heavy selling by mortgage players in response to a recent
spike in home loan rates intensified the bond sell-off. The
10-year U.S. note yield posted its biggest one-day spike in
eight months and flirted with a six-month high set last week.
(Additional reporting by Denny Thomas in SYDNEY; Editing by
Kim Coghill)
