* Asian stocks ease as China ratchets up cash draining
* Chalco shares slip on Alcoa's disappointing results
* Nikkei hits 15-month high buoyed by resource-linked plays
* Dollar rises vs yen, euro on China sovereign fund comment
By Kevin Yao
SINGAPORE, Jan 12 (Reuters) - Asian stocks fell on Tuesday,
a day after hitting a 17-month high, on investor jitters about
tighter monetary policy in China, while the dollar rose after a
Chinese sovereign fund official said the currency has bottomed.
Shares in Aluminum Corp of China (Chalco) <2600.HK>, fell
as much as 4.7 percent Kong on disappointing results from U.S.
aluminum producer Alcoa <AA.N>.
Alcoa Inc <AA.N> posted a narrower quarterly loss on
Monday due to higher power bills and a weak dollar, but the
results fell short of expectations and the aluminum producer's
stock fell more than 5 percent. []
The MSCI index of Asia Pacific stocks traded outside Japan
<.MIAPJ0000PUS> shed 0.4 percent, after China's central bank
stepped up its efforts to mop up money from the financial
system. The Thomson Reuters index of Asian shares <.TRXFLDAXPU>
was down 0.7 percent.
European stocks were expected to edge lower, adding to the
previous session's dip. Financial spreadbetters saw Britain's
FTSE 100 <> to open 3 to 6 points lower, Germany's DAX
<> to open up 1 point to down 4 points, and France's
CAC-40 <> to open 4 to 8 points lower. []
The People's Bank of China on Tuesday raised the auction
yield on one-year bills by a bigger-than-expected 8.29 basis
points and drained a record 200 billion yuan ($29 billion) from
the market, signalling a bias to tighten monetary conditions.
[]
"The rise in the auction yield today was much more than an
average market forecast of a four-basis-point rise, meaning the
central bank has stepped up its draining of liquidity even more
strongly than the market had expected," said Dong Dezhi, senior
money market analyst at Bank of China in Shanghai.
Last week, the bank had surprised markets by raising the
interest rate on three-month bills for the first time since
August, raising fears of a tightening cycle to head off
economic overheating.
A HASTY ADVANCE?
Analysts expect the central bank to raise interest rates
and let the yuan, pegged to the dollar, appreciate gradually
later this year. But any harsh policy tightening appears
unlikely in the near term.
Asian central banks and governments are expected to be
tread cautiously in winding up fiscal stimulus and tightening
monetary policy, given the lingering uncertainties in the
global economy.
"I think markets may be getting a little ahead of
themselves. We saw this back in 2009 with the Fed and look how
that has panned out," said Selena Ling, head of treasury
research and strategy at OCBC Bank in Singapore.
The benchmark Shanghai stock index <> erased earlier
losses and turned round sharply to a gain of nearly 2 percent
while Hong Kong's index <> was unchanged.
Japan's Nikkei hit a 15-month high, lifted by resources
stocks such as Sumitomo Metal Mining <5713.T> on higher gold
prices, though tech stocks fell pressured by a stronger yen.
The dollar rose against the yen <JPY=> and the euro <EUR=>
after a China sovereign fund official said the dollar has hit
bottom and has limited room to fall further. [].
But the dollar gave up gains to as high as 92.43 yen after
the official said the comments were his personal views.
Oil <CLc1> fell 43 cents to $82.09 a barrel, while gold
<XAU=> hovered near 1,150 per ounce, a day after hitting a
five-week high at $1,157.65 as data showed a sharp rise in
China's commodities imports.
(Editing by Jan Dahinten)
