* Japan shares slump more than 6 percent
* Japan grapples with 3rd explosion at nuclear plant
* Seoul posts small gain, others small losses
* Yen steady, Korean won seeks to break losses
(updates,adds fund manager comments)
By Jungyoun Park and David Chance
SEOUL, March 15 (Reuters) - Japanese shares slumped more
than 6 percent for a second day on Tuesday, dragging down most
other Asian markets as a fresh explosion rocked a stricken
nuclear plant in the country's northeast.
The yen was steady against the U.S. dollar despite the sharp
selloff in Japanese stock markets and there were few signs that
Japanese insurers were repatriating funds to help pay for the
costs of the quake and tsunami that hit on Friday.
The Korean won , attempting a rebound from a three-day
losing streak, started stronger but then slipped back to be
marginally up. The won was quoted at 1,125.10/40 per
dollar.
South Korean shares staged a tepid rally after initial small
losses with the index up 0.16 percent by 0118 GMT.
Australian shares were down just 0.55 percent, a tad
weaker than their open and Taiwan and Hong Kong both posted
small losses.
"While the quake, tsunami and nuclear power crisis in Japan
are bad news from galobal investment perspective, investors are
taking a relative and comparative approach on South Korea at
this time," said Lee Jun-hyuck, senior fund manager at Dongbu
Asset Management in Seoul.
"First off, a lot of Japanese refiners, steelmakers and
chipmakers are shut down, and supply of the products is tight.
This helps with pricing of products being manufactured by South
Korea," he said.
In Tokyo, the broad TOPIX index plunged nearly 7 percent
to below 790, the lowest since April 2009, after posting
the biggest decline since the 2008 financial crisis on Monday on
record volume.
The blue-chip Nikkei index dropped 6.4 percent to
just below 9,000, driven down by selling in the futures market.
"All focus is on the nuclear crisis. In the situation where
the crisis appears to be worsening, foreign investors, domestic
fund operators are pulling out from Japanese shares," Hideyuki
Ishiguro, a supervisor at Okasan Securities in Tokyo.
OIL AND YEN STEADY, AUSTRALIAN MINERS HIT
Oil rebounded from lows triggered by Japan's earthquake due
to unrest in the Middle East as Saudi Arabia sent troops into
Bahrain to help quell unrest.
U.S. crude for April edged up 11 cents to $101.30 a
barrel by 0035 GMT, after recovering on Monday from a nadir of
$98.47, the lowest intraday price since March 1 while Brent
crude futures for April delivery fell 14 cents to
$113.53 a barrel.
The Japanese yen was steady at around 81.80 as the
Bank of Japan on Tuesday offered to pump 5 trillion yen ($61
billion) into the banking system, continuing its huge fund
injection aimed at easing market jitters amid escalating damage
from the earthquake.
Shares in Australia took a hit from the country's uranium
miners, although many stocks rallied off their lows to post
small losses. Paladin shares were down just 0.23
percent at 0129GMT having opened 3.8 percent lower, while Energy
Resources of Australia , a unit of global miner Rio
Tinto fell 1.82 percent, extending early
losses.
In Seoul, nuclear power issues pared early losses. KEPCO
Engineering & Construction was down 3.3 percent
after a more than 5 percent fall at the open.
U.S. Treasury yields fell on Tuesday on the unrest in the
Middle East which outweighed fears Japanese insurers would sell
to respond to the earthquake and traders in Tokyo said there had
been few signs of that so far.
Japan is the second-biggest holder of U.S. government debt.
Benchmark 10-year notes were at 3.37 percent.
(Additional reporting by Chikafumi Hodo and Antoni
Slodkowski in TOKYO, Vikram S Subhedar in HONG KONG, Clare Jim
IN TAIPEI; Editing by Richard Borsuk)
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