* Asian shares up 3.7 pct on hopes for government action
* Oil rebounds more than $1 to above $43 a barrel
* Safer haven assets such as yen fall
* Rio Tinto announces capital spending cuts
(Repeats to additional subscribers with no changes to text)
By Rafael Nam
HONG KONG, Dec 10 (Reuters) - Asian stocks rallied more
than 3 percent to a one-month high on Wednesday on hopes
governments worldwide will help out ailing industries and
implement stimulus measures as they fight back against a
deepening economic crisis.
The White House and U.S. Congressional Democrats reached a
tentative agreement on a bailout for beleaguered U.S. auto
makers, sending counterparts such as Honda Motor <7267.T>
sharply higher. Hopes are also rising in Asia for
government-led help for key sectors such as technology.
[]
Global miner Rio Tinto <RIO.AX> was in focus after it
announced plans to cut capital spending, slash jobs and boost
asset sales but said it would hold its dividend steady.
[]
European shares were set to open marginally higher, while
oil rebounded more than $1 to above $43 a barrel from a slump
on Tuesday. Assets seen as safer havens during volatile times
such as the Japanese yen and U.S. Treasuries pulled back.
"What we are seeing right now may be a gradual turnaround
in global stocks as liquidity in financial markets is seen
slowly improving, helped by the latest moves by governments,"
said Jun Ji-won, a market analyst at Kiwoom.Com Securities in
Seoul.
"Stabilisation in foreign exchange is also helping."
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> was up 3.8 percent at 0700 GMT, after earlier
hitting its highest level since Nov. 12. Japan's Nikkei average
<> gained 3.2 percent.
The Asia-Pacific index is now up more than 20 percent since
hitting a five-year low on Nov. 21, but has still fallen by
more than half this year.
INDUSTRY SUPPORT
Governments worldwide are looking to spend their way out of
sharply slowing economic growth via various stimulus measures,
while expectations are rising they will also step in to help
sectors and companies in trouble.
U.S. stock futures <SPc1> gained more than 1 percent after
the White House and U.S. congressional Democrats reached an
agreement in principle on a $15 billion proposal to bail out
U.S. auto makers, potentially staving off bankruptcies that
would have roiled global markets. []
Help from governments could spread beyond helping banks to
other industries elsewhere as well. In Taiwan, struggling
memory chip maker ProMOS <5387.TWO> asked for government
assistance, sending shares up 6.5 percent. []
The rebound in global markets comes against a backdrop of
falling interest rates and plunging commodity prices.
The combined actions may be bearing fruit. Australia's
consumer sentiment was surprisingly stronger than expected in
December on the back of sharp falls in interest rates and
petrol prices, according to data on Wednesday. []
Main stock indexes in South Korea <> Taiwan <>
and Hong Kong <> rose 3 to 4 percent each, while shares in
Singapore <.FTSTI> and India <> advanced more than 2
percent.
Australia <> and Shanghai <> saw smaller gains.
DEGREE OF CAUTION
Still, signs of caution are not hard to find, casting
doubts on a sustained rebound in global markets.
The World Bank warned on Wednesday economies in East Asia
will slow substantially in 2009 due to the broad effects of the
credit crisis, despite government attempts to boost domestic
demand. []
Data meanwhile showed Japan's core machinery orders fell
more-than-expected, underlining a weakness in corporate capital
spending. In China, wholesale price inflation collapsed last
month, sparking fears of a period of sustained global
deflation. []
Still, gains in stocks helped push down the yen against the
dollar and the euro. The Japanese currency has strengthened
this year as investors, shunning most types of risk, unwound
trades that had used the low-yielding yen.
"The uncertainties that have been dogging the market are
being removed one by one," said Hideaki Inoue, chief manager of
forex trading at Mitsubishi UFJ Trust Bank in Japan.
"Equity markets are bottoming out. Measures by governments
to help economies are also being seen in a positive light. All
these factors have helped reduce market volatility."
The dollar rose 0.5 percent from late U.S. trading on
Tuesday to 92.54 yen <JPY=>, while the euro advanced 0.8
percent to 119.83 yen <EURJPY=R>.
Emerging currencies that had recently been under fire rose
to multi-week highs on reviving demand for Asian assets.
The Indonesian rupiah <IDR=> gained almost 1.4 percent to
10,900 per dollar, its highest in a month. The South Korean won
<KRW=> jumped 3.8 percent to end the session at about 1,393.70
per dollar, having hit its highest in almost four weeks.
Oil prices pared Tuesday's steep losses to rise above $43 a
barrel <CLc1>, though caution remains ahead of U.S. government
data later in the day expected to show a fall in U.S.
distillate and gasoline inventories.
(Additional reporting by Park Jung-youn in SEOUL and Shinichi
Saoshiro in TOKYO; Editing by Dhara Ranasinghe)
