* Stocks inch up; U.S. retail sales lift hopes for economy
* Yen retreats after rise on yuan talk
* S.Korea keeps interest rate for 14th mth; stocks down
* EM equity inflows at six month high -EPFR Global data
By Aiko Hayashi
TOKYO, April 9 (Reuters) - Asian stocks edged closer to a
22-month high on Friday, supported by strong U.S. retail sales
data, while the yen retreated against major currencies after
rising the previous day on talk that China is likely to allow a
modest appreciation in the yuan.
The yen was under pressure after news that Prime Minister
Yukio Hatoyama will meet with Bank of Japan Governor Masaaki
Shirakawa around 0300 GMT to discuss the economy and financial
situation. []
"An announcement on monetary policy out of this meeting is
unlikely, but the event is probably for the government to make
an additional request to the Bank of Japan for more easing
steps, providing a yen-selling factor," said a trader for a
Japanese bank.
The MSCI's broad measure of shares in the Asia-Pacific
outside Japan <.MIAPJ0000PUS> rose 0.33 percent, staying near
levels last seen in June 2008 hit on Wednesday and bringing
gains since the beginning of the year to more than 4 percent.
Seoul shares <> slipped 1.3 percent as a strengthening
won <KRW=> dented appetite for key exporters such as Hyundai
Motor <005380.KS>, while reaction to the Bank of Korea's
decision to hold its interest rate was limited. []
Tokyo's Nikkei average <> was flat, with profit-taking
after the benchmark's recent rally to 18-month highs offsetting
strong earnings guidance from the likes of popular casual
clothing chain Fast Retailing <9983.T>. []
The Nikkei has gained nearly 6 percent so far this year.
Better-than-expected U.S. retail sales data helped support
sentiment, but gains are likely to be kept in check ahead of
U.S. earnings next week from heavyweights such as Intel Corp
<INTC.O> with investors mindful of longer-term uncertainty
about the U.S. economic recovery and simmering worries about
debt-laden Greece.
"Though market attention has shifted to earnings, the
Japanese season doesn't really get going for another two weeks,
meaning the market may search for direction," said Kenichi
Hirano, operating officer at Tachibana Securities in Tokyo.
"But with few strong reasons to sell at this point, any
falls are likely to be limited."
On Thursday, top U.S. chains reported a record
year-over-year increase in same-store sales for March, sending
the S&P 500 Index <.SPX> 0.3 percent higher. The sales
reflected a boost in consumer demand that some investors had
doubted would materialise, with job growth still anemic.
[]
The greenback rose 0.1 percent to 93.47 yen <JPY=> after
the market found solid bids below 93 yen on Thursday when it
fell as far as 92.83 yen. Asian currencies are seen likely to
gain from any move by China to revalue its currency.
[]
Speculation about a firmer Chinese yuan has reached fever
pitch since The New York Times said China was close to
announcing a shift in policy involving a "small but immediate"
yuan revaluation.
On Thursday, U.S. Treasury Secretary Timothy Geithner and
Chinese Vice Premier Wang Qishan exchanged views on U.S.-China
economic relations and the global economy during a meeting in
Beijing. [].
The euro rose earlier as investors trimmed record-high
short positions, but it struggled to keep those gains as
worries about debt-laden Greece simmered in the background.
The single currency was steady at $1.3360 <EUR=>, having
lost about 7 percent since the beginning of the year.
Commodity prices were steady, with U.S. crude futures
<CLc1> rising towards $86 a barrel, after falling the two
previous days, while Gold <XAU=> ticked higher, hovering near a
3-month high hit the previous day.
The Japanese government bond yield curve remained under
flattening pressure as the superlong sector stayed bullish on
continuing purchases from investors such as life insurers.
Mitsui Life Insurance Co said in an interview with Reuters
on Thursday that Japan's fifth-largest life insurer is likely
to buy 100 billion yen ($1.07 billion) in superlong bonds in
the current financial year. []
Investor interest in emerging markets and their commodities
stories jumped during the first week of April, data from fund
tracker EPFR Global showed on Thursday, with flows into EPFR
Global-tracked emerging markets equity funds hitting a 24-week
high.
Emerging Markets Bond Funds extended their inflow streak to
22 straight weeks and Commodity Sector Funds absorbed another
$265 million, EPFR said, but Japan Equity Funds posted outflows
for the first time this year as a stronger yen and disappointed
business investment numbers offset bullish expectations for the
first quarter earnings season.
(Additional reporting by Satomi Noguchi and Elaine Lies in
Tokyo; Editing by Vikram S Subhedar)
