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(Updates with European outlook, fresh prices, details)
By Rafael Nam
HONG KONG, April 3 (Reuters) - Asian stocks rose to their
highest in a month on Thursday as a rally in gold and oil
lifted resource shares, while a surprisingly optimistic
indicator for U.S. jobs raised hopes of a milder U.S. economy
recession than previously feared.
The U.S. private sector added 8,000 jobs in March,
according to a report on Wednesday by ADP Employer Services,
confounding economist expectations and taking some of the sting
off the Federal Reserve Chairman Ben Bernanke's warning that
the U.S. economy may slip into recession, his first such
concession.
The U.S. dollar recovered from early weakness to hit a
three-week high against the yen as some bet the worst of the
global credit crunch could be over, despite warnings from some
analysts and executives that there is more pain to come in both
the U.S. economy and the financial sector.
That appeared to be the cue taken by European shares, which
were set to open slightly lower according to financial
bookmakers, pausing after a two-day rally.
"We are at an interesting juncture where we've got negative
forces like the U.S. credit and subprime problems and positive
forces from all the demand for resources," said Peter Vann,
head of investment research at Constellation Capital Management
in Australia.
"Investors certainly don't like to hear the word
'recession' but there was nothing new there because most
commentators have been talking about a strong likelihood of a
U.S. recession. Bernanke was just giving further credence to
that."
The Fed Chairman had told a congressional panel on
Wednesday the U.S. economy may slip into recession, but said
growth should pick up later this year as the impact of U.S.
interest rate cuts and other emergency steps take root.
[]
The MSCI's measure of Asian stocks outside Japan
<.MIAPJ0000PUS> rose 1.3 percent by 0630 GMT, hitting its
highest level since early March.
The prospects of a U.S. recession and the global financial
crisis have dented Asian shares this year, with the MSCI index
still down 10.6 percent in 2008.
But in what some investors see as hints of a recovery, the
index rose 2.9 percent on Wednesday after write-downs and
capital raisings by global investment banks such as UBS
<UBSN.VX> was seen as an attempt to get a handle on the soured
subprime-related portfolios.
"Investors are now focused on potentially positive factors
rather than negative factors, as was seen in the recent relief
rally after huge writedowns by UBS for instance," said Lee
Sun-yeon, a market analyst at Goodmorning Shinhan Securities in
Seoul.
"Also the view is that the U.S. economic slowdown will not
be as sharp as previously feared," he added.
DOUBTS PERSIST
Australian shares <> rose 1.9 percent, hitting a
five-week high, boosted by gains in heavyweight resource firms
such as BHP Billiton Ltd <BHP.AX> and Woodside Petroleum
<WPL.AX>.
Japan's Nikkei average <>, which suffered heavily in
the first quarter, rose 1.5 percent.
Shares in South Korea <>, Hong Kong <> and
Singapore <.FTSTI> were also up over 1 percent each.
POSCO <005490.KS> surged 6.2 percent after the South Korean
steel maker said it was considering raising steel prices.
[]
Shares in Shanghai <> gained 2.3 percent, recovering
from a 7 percent drop over the previous two sessions. Markets
in Taiwan <> and India <> were little changed.
Still, economists and organisations such as the Asian
Development Bank have this week warned of slower growth in the
region as exports to the United States are likely to slow at a
time of rising inflationary pressures.
The chairman of South Korea's Hyundai Motor Co <005380.KS>,
Chung Mong-koo, expressed his worries over demand in the United
States citing the rising fuel prices, according to a statement
from the auto maker on Thursday. []
Meanwhile, Japan's Sony Corp <6758.T> said on Thursday it
would cut costs and attract more orders to offset the negative
impact of the yen's strength on its profit, following the drop
in the U.S. dollar this year. []
In a reprieve to Asian exporters, the dollar hit a
three-week high of 102.85 yen <JPY=>, while also climbing about
0.4 percent against the euro <EUR=> on the back of strong
buying from hedge funds and investors at the start of Japan's
fiscal year.
The dollar's climb failed to dent commodity prices. U.S.
crude futures <CLc1> steadied at $104.53 a barrel a day after
oil prices surged almost $4 following U.S. government data
showing a sharp drawdown in refined fuel stocks. []
The gains in oil helped gold <XAU=> rise to $902.10/903.00
an ounce from $898.00/898.80 in late U.S. trade on Wednesday,
still more than $100 an ounce off last month's record high of
$1,030.80.
(Editing by Lincoln Feast)
