* Israel attacks on Hamas lift oil prices, resource shares
* Stock investors pin hopes on 2009 stimulus spending
* JGB 10-yr yield hits 5-year low, Treasuries up
(Refiles to correct spelling of violence in headline)
(Repeats to additional subscribers with no change to text)
By Eric Burroughs
HONG KONG, Dec 30 (Reuters) - Oil prices and shares of
resource producers rose on Tuesday as Israel began a fourth day
of attacks on the Islamic group Hamas, while the flare-up of
violence stirred caution among investors at year-end and dented
the dollar.
Japan's Nikkei average <> climbed 1.3 percent to a
seven-week peak in a holiday-shortened session, but wrapped up
its worst year on record with a loss of 42 percent after the
financial crisis and surging yen drove the country's economy
into a recession.
The jump in oil and gold prices drove the dollar lower,
though moves were choppy as many market players have already
put the finishing touches on their portfolios for the year and
have shifted to the sidelines.
Israeli warplanes killed 10 Palestinians on Tuesday in
attacks targeting government buildings and other symbols of
Hamas in the fiercest air offensive in Gaza in four decades,
stirring concerns about Middle East energy supplies.
[]
"There's a lot of new uncertainties out there, such as the
whole Israeli issue, but it is giving some support to
resource-linked shares," said Tomomi Yamashita, a fund manager
at Shinkin Asset Management in Tokyo.
Stocks have gradually recovered from this year's lows hit
in November for many indexes as governments have lined up hefty
stimulus spending packages and central banks have slashed
interest rates to try to revive growth.
Investors have also pinned their hopes on U.S.
President-elect Barack Obama, whose team has been working with
Congress on a fiscal stimulus that he is expected to sign
shortly after taking office on Jan. 20.
Seoul's KOSPI <> rose 1.7 percent to 1,136 points,
snapping a five-session losing streak on gains in blue-chip
shares such as Samsung Electronics <005930.KS>.
"We think expectations for economic recovery and the
effects of economic stimulus measures on the real economy will
boost stocks to as high as 1,500 in the first half of 2009,"
said Lee Sun-yeob, a market analyst at Goodmorning Shinhan
Securities in Seoul.
U.S. crude oil prices <CLc1> were up 20 cents at $40.22 a
barrel, rising for a third day but on track to end the year
down 60 percent. Gold dipped 50 cents an ounce to $877.00
<XAU=> after hitting a 2-1/2-month high of $889.55 on Monday.
DOLLAR RETREATS, BONDS GAIN
The dollar lost more ground as the Middle East troubles
sparked buying of the Swiss franc and euro. The euro climbed
1.2 percent to $1.4102 <EUR=> after a volatile session the
previous day saw it tumble more than 4 cents from its intraday
peak.
The dollar has also surrendered gains made earlier in the
year as the extreme aversion to risk among investors has
relented and U.S. investors have slowed some of their big
repatriation of overseas investments.
Government bonds rose as investors favoured their safety
over the New Year's holidays, with the benchmark 10-year
Japanese government bond yield <JP10YTN=JBTC> falling 3.5 basis
points to 1.165 percent and hitting a five-year low of 1.155
percent.
For the year 10-year JGB yields have fallen 33.5 basis
points, the biggest yearly drop since 2002 -- when Japan was
last mired in recession and suffering from deflation.
U.S. Treasuries climbed in Asia trade. The benchmark
10-year note <US10YT=RR> was up 13/32 in price to yield 2.069
percent, down 4 basis points on the day and near a five-decade
low of 2.04 percent struck last week.
The U.S. 10-year yield has plunged nearly 2 percentage
points on the year.
(Additional reporting by Elaine Lies in Tokyo and Jungyoun
Park in Seoul; Editing by Lincoln Feast)
