* Nikkei surges to 3-wk closing high Wall Street's firm
close
* Dollar pauses, euro up on Greece bailout talk
* China shares dip as Shanghai re-opens after week-long
break
* Oil surges to a 6-week peak on France strike, Iran
tensions
By Umesh Desai
HONG KONG, Feb 22 (Reuters) - Asian stocks leapt to their
highest in nearly a month on Monday as risk appetite improved
on talk of a quick bailout for Greece and as investors looked
past the Federal Reserve's discount rate hike to signs of
strength in the U.S. economy.
The euro <EUR=> edged higher after German magazine Der
Spiegel reported at the weekend that Germany's finance ministry
had prepared a bailout plan for debt-laden Greece in which euro
zone countries would provide aid worth 20 billion to 25 billion
euros.
European stock index futures <> pointed to a slightly
higher open as markets waited to see if a rescue plan would
really materialise, while U.S. stock futures <SPc1> rose 0.3
percent.
A pause in the dollar's rally spurred gold to its highest
level in a month and helped oil prices to a six-week high.
The MSCI index of Asian stocks traded outside Japan
<.MIAPJ0000PUS> rose 2.2 percent, at one point hitting its
highest level since Jan 26, helped by shares in the materials
and energy sectors as commodity prices pushed higher.
"Positions have been significantly unwound and are very
light across most asset classes," said Peter Redward, head of
Emerging Asia Research, Barclays Capital, referring to recent
market jitters about Greece and concerns about monetary
tightening globally.
"That means potentially if we get a period of good news, we
could see markets run for a little while."
Japan's Nikkei stock average rose 2.7 percent to its
highest close in three weeks. The rally was led by exporters
whose shares were boosted by a weak yen amid recent dollar
strength.
"Investors on Friday were worried about the impact of the
U.S. discount rate hike on Wall Street, but U.S. markets in the
end were quite settled," said Nagayuki Yamagishi, a strategist
at Mitsubishi UFJ Securities.
The Fed said late on Thursday that it would raise the
interest rate it charges banks for emergency loans to 0.75
percent from 0.5 percent, taking a step towards normalising
emergency policy used to fight the worst financial crisis since
the Great Depression.
Asian stock markets fell heavily on Friday in the first
global reaction to the move, but after initial nervousness U.S.
investors preferred to view it as a sign that the economy was
healing, helping stocks on Wall Street close out their best
week of the year. []
Asian share markets were also buoyed by a relatively calm
start in Chinese markets as they re-opened after a week-long
holiday and had their first chance to react to a surprise
central bank tightening move on Feb 12.
Markets had feared a heavy selloff in Shanghai after the
People's Bank of China raised banks' reserve requirements for
the second time this year, but China's key stock index <>
was little changed for much of the day before ending down 0.5
percent.
Hong Kong's benchmark Hang Seng Index <> rose 2.3
percent, lifted by consumer-sector focused China Resources
Enterprise <0291.HK> amid signs of stability in Chinese markets
and oil producer CNOOC <0883.HK> which rose on firmer oil
prices.
South Korean shares ended a two-day losing streak with the
benchmark index <> up 2 percent, boosted by rebounds in
the technology and financial sectors.
"Asian markets at these levels are quite cheap and there is
reasonable good growth in the region over the next 1-2 years so
we think that these levels are buying levels," said Khiem Do,
head of the Asia multi-asset group at Baring Asset Management,
which oversees $50 billion.
"We still like North Asia -- Taiwan, South Korea and
China."
EURO FIRMS, DOLLAR DOZES
The euro jumped as much as 0.3 percent to $1.3655, before
surrendering gains to trade marginally firmer at 1.3620.
The currency struck a nine-month low of $1.3443 on trading
platform EBS on Friday after the Fed announced its decision to
raise the discount rate.
But analysts do not expect a quick resolution to Greece's
problems, despite the initial optimism in markets.
"Bear in mind the Europeans have not given us specifics --
there is still room for disappointment. It will simmer away in
the background as a concern for the markets," said Redward.
The dollar index, which measures the dollar's value against
a basket of currencies, dipped 0.2 percent to 80.469 <.DXY>,
having retreated from an eight-month high of 81.342 hit on
Friday.
The dollar's decline helped push up oil prices, which were
already gaining on concerns about an extended refinery strike
in France and escalating tensions over Iran's nuclear program.
Oil prices <CLc1> rose 45 cents to above $80 a barrel, the
highest since Jan 13.
(Editing by Kim Coghill)
