* Asia stocks ex-Japan rise 0.6 pct, Nikkei down 0.5 pct
* Financials gain as US rule changes not as onerous as
feared
* Little substance seen from G20 meeting
* Attention shifting to sustainability of global recovery
* Yuan mid-point set at post-revaluation high
(Updates Asian markets, adds Europe, U.S. data)
By Rujun Shen and Edmund Klamann
SHANGHAI, June 28 (Reuters) - Most Asian stock markets rose
on Monday, with Europe set to follow, as fears eased that
Washington would draft a harsh bill for regulating the banking
sector and after an unremarkable conclusion to a Group of 20
leaders' summit.
G20 leaders meeting in Toronto agreed to take their own
paths to ensuring economic growth and left room to move at
their own pace, trying to balance contrasting priorities by
pledging to halve budget deficits by 2013 without stunting
growth.
The heads of the G20 rich and developing nations also
promised to clamp down on risky behaviour by banks without
restricting lending, and agreed to give banks more time to
adopt tougher rules. []
That followed an historic overhaul of financial regulations
by U.S. lawmakers on Friday, with banks forced to spin off swap
trading operations. Banks will be able to keep most of their
books but will be barred from commodity, equity and some credit
default swaps. []
"I don't see much substance from G20," said Lin Yuhui,
deputy general manager of Jinhui Futures. []
"Basically it's saying everyone is back to minding their
own business, just like before the crisis," Lin said.
The MSCI index of Asia Pacific shares outside Japan
<.MIAPJ0000PUS> rose 0.6 percent, with financial shares
outperforming. Hong Kong stocks <> led the way, rising 0.4
percent.
Financial bookmakers said Europe's main benchmark indexes
would likely head in the same direction, with spreadbetters
expecting Britain's FTSE 100 <>, Germany's DAX <>
and France's CAC- 40 <FCHI> to open as much as 0.9 percent
higher. []
U.S. stock futures <.SPc1> were slightly weaker, however.
Investors will have to weather a welter of U.S. data this
week, including June jobs numbers on Friday, consumer
confidence, pending home sales and some early earnings reports.
[]
U.S. economic data has been mixed in recent weeks, raising
doubts about the strength of its recovery.
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In Tokyo, the Nikkei share average <> fell 0.5
percent, extending falls after closing last week below a key
support level and booking its biggest weekly loss in a month
with an indecisive outcome likely in an upper house poll next
month.
A muted reaction to the G20 meeting didn't help, with the
Japanese market slipping across the board. []
Wall Street <.SPX> had finished almost unchanged on Friday,
although financial stocks had gained on relief the U.S.
financial regulation bill would not inhibit Wall Street profits
as much as had been feared. []
Underlining the less-than-decisive conclusion to the G20
summit, Angel Gurria, head of the Organisation for Economic
Co-operation and Development, said the "incipient recovery"
offered policy choices but also made it harder to find common
ground. []
"When the house was on fire, we all knew what to do: get a
hose," Gurria told G20 leaders.
Asian debt spreads narrowed after widening in the previous
four sessions, with investors encouraged to buy riskier assets
after the G20 leaders committed to cutting budget deficits.
The Asia ex-Japan iTraxx investment-grade index
<ITAIG5Y=MP> narrowed 7 basis points (bps) from Friday to
132/134, a Singapore-based trader said. CHINA MUTES YUAN TALK
Signalling the difficulties groups such as the G20 have in
addressing matters crucial to global economic imbalances, China
succeeded in having a line praising its decision to move
towards a more flexible exchange rate removed from the G20
communique.
Beijing maintains debate about the yuan has no place in
international forums, and did not want even a positive
reference to the currency to set a potential precedent for
singling its currency out.
The People's Bank of China set the yuan's daily mid-point
<CNY=SAEC> at 6.7890 against the dollar on Monday, a new
post-2005 revaluation high.
The yuan has risen about 0.5 percent in the past week since
the PBOC said on June 19 that it was unshackling the currency
from its two-year-old peg to the dollar, but gains have been
kept in check by big state-owned banks and any further
appreciation is expected to be glacial.
Japan's retail sales in May rose 2.8 percent from a year
ago, their slowest annual pace since January, in a sign
consumption driven by government stimulus spending may be
slowing. Retail sales had been surging since the start of the
year, helped by government subsidies for durable goods.
Investors seeking to cut long positions in favour of the
greenback had the dollar on the defensive on Monday. The euro
held gains as the focus shifted to the sustainability of a U.S.
recovery from euro zone debt worries. []
The dollar index <.DXY> edged up 0.1 percent to 85.43,
holding above last week's low of 85.09. The dollar hovered near
a five-week trough against the yen after data released on
Friday showed U.S. gross domestic product in the first quarter
grew more slowly than expected. [].
"I have a feeling in my bones that perhaps Friday was the
start of the market questioning the viability of the U.S. as
the safe haven," said Tim Lovell, an economist at ICAP in
Sydney. Higher commodities and the subdued U.S. dollar helped
the Australian and New dollars. [] The Australian
dollar <AUD=D4> held firm at around $0.8750. U.S. crude oil
futures <CLc1> briefly rose to their highest in nearly eight
weeks at $79 a barrel as tropical storm Alex forced Mexico to
reduce oil exports and some U.S. producers to evacuate
platforms and curb output. []
(Additional reporting by Rika Otsuka, Aiko Hayashi and
Tetsushi Kajimoto in TOKYO, Lu Jianxin in SHANGHAI, Gyles
Beckford in WELLINGTON, Anirban Nag in SYDNEY, Alejandro
Barbajosa in SINGAPORE; Writing by Paul Tait; Editing by Kim
Coghill)
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