* Bank stocks rally for second day, Japan tech sector
climbs
* Political risks flare up in India, Thailand
* Oil slips below $54, with demand uncertain
(Repeats to more subscribers)
By Kevin Plumberg
HONG KONG, Nov 27 (Reuters) - Asia stocks rose for a fifth
day on Thursday, helped by hopes that policymakers' efforts
will ultimately prevail after a surprise and aggressive rate
cut from China, though U.S. data ominously reflected a deep
recession.
Investor sentiment also improved after U.S. stocks chalked
up a four-day winning streak, their longest run since May, as
shares in General Motors Corp <GM.N> and Ford Motor Co <F.N>
surged on expectations that Washington will bail out the car
industry.
While investors cheered China's policy moves, views on
India, emerging Asia's other titan, darkened after militants
killed at least 86 peple in the financial capital Mumbai.
India's stock markets were shut for the day following the
attacks.
Oil prices shrugged off the rise in Asian equities and fell
more than $1 near $53 a barrel as investors shifted their focus
back to distressed demand, after U.S. government data showed a
sharp buildup in crude stocks.
Two different camps of investors were emerging as the end
of a wild, volatile year for markets approaches. One group
believes global equity prices have already discounted a global
recession and now there is value to be found in some beaten
down sectors, like financials and consumer goods companies.
The other pack thinks the boost from trillions of dollars
of government stimulus and aggressive central bank moves --
like China's surprising 1.08 percentage point cut in interest
rates -- will help down the line but the near-term drag from
shrinking economies in Europe, Japan and the United States is
inescapable.
"China's rate cuts only help to some extent for the Asian
risk environment because the key ingredient that's driving the
gloomy outlook is actual demand, especially from advanced
economies," said Suan Teck Kin, an economist with United
Overseas Bank in Singapore.
"These would help spur some investment and spending
activities and support the fiscal initiatives but the main
driver would still be from actual spending."
Stocks in the Asia-Pacific region outside of Japan were up
2.7 percent, set for a fifth straight day of gains, according
to an MSCI index <.MIAPJ0000PUS>. Still the index is on track
for a seventh month of declines, down about 9 percent in
November.
Hong Kong's Hang Seng index <> rose 2.9 percent, while
Shanghai's composite index <> rose 4.7 percent.
Bank stocks benefited from a drop in reserve requirements,
with shares of China's biggest bank, Industrial and Commercial
Bank of China Ltd <1398.HK><601398.SS>, up 4 percent.
In Japan, the Nikkei share average <> climbed 2.4
percent, supported by a rally in the technology sector, which
globally has been a hard-hit because of its dependence of
business and consumer spending.
U.S. markets were closed on Thursday for a public holiday,
but investors would undoubtedly be on the lookout for retail
sales figures for the day after Thanksgiving on Friday. That is
traditionally the busiest time for retailers but desultory
economic conditions may encourage consumers to temper spending.
POLITICAL RISKS BUILD
The last few days have seen a buildup in political risks in
Asia, especially after the attacks in India and anti-government
protestors in Thailand blockaded an airport in Bangkok.
Thai stocks <> were down 1.6 percent as protests in
Bangkok threatened to escalate into widespread civil unrest
after the country's prime minister refused to step down.
[]
The cost of protection against sovereign debt default in
Thailand and indications of heightened aversion to risk rose in
India, adding to uncertainty when investors crave for stability
with focus still on the economic impact of the financial
crisis.
"Clearly, it will be negative for the sentiment towards
India at this point of time, the time when the world is already
looking to be highly uncertain in terms of its growth
prospects," said Joseph Tan, Asia chief economist with Credit
Suisse in Singapore, referring to the attacks in Mumbai.
"This will be negative for the rupee versus the dollar, but
again I want to stress that the impact will be short-lived."
The U.S. dollar steadied against the euro after rising on
Wednesday on a string of weak U.S. economic data that
accelerated safe-haven flows into the world's foremost reserve
currency.
U.S. consumer spending in October posted its biggest drop
in more than seven years, and consumer confidence fell to a
28-year low in November, further darkening the economic
outlook. []
The euro rose 0.1 percent to $1.2900 <EUR=>, after falling
as low as $1.2819 on Wednesday, partly on pessimistic views
about the impact of a 200 billion euro European stimulus plan.
The dollar fell 0.3 percent to 95.48 yen <JPY=>, having
rebounded from Wednesday's low of 94.60 yen.
U.S. crude futures fell towards $53 a barrel on Thursday,
as investors fretted over falling oil demand, erasing some of
the previous day's sharp gains.
(Additional reporting by Eric Burroughs; Editing by Dhara
Ranasinghe)
