* Bank stocks rally for second day, Japan tech sector
climbs
* India attacks, Thailand unrest increase political risk
* Oil slips toward $53, with demand uncertain
(Updates prices, adds gold and Swiss franc)
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 China's big rate cut, though U.S.
data provided an ominous reminder of the global slowdown.
While investors cheered China's largest rate reduction
since the Asian financial crisis, views on India, emerging
Asia's other titan, darkened after militants killed at least
101 people and held foreigners hostage in the commercial
capital Mumbai.
India's financial markets were shut for the day following
the attacks. []
Oil prices <CLc1> shrugged off the rise in Asian equities
and fell more than $1 toward $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 year for markets approaches. One group believes
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 3.6 percent, while
Shanghai's composite index <> rose 4 percent.
Chinese bank stocks got a boost from a drop in reserve
requirements, with shares of the country's biggest bank,
Industrial and Commercial Bank of China Ltd
<1398.HK><601398.SS>, up 4.3 percent in Hong Kong.
In Japan, the Nikkei share average <> climbed 2
percent, supported by a rally in the technology sector, which
globally has been hit hard because of its dependence of
business and consumer spending.
U.S. markets are closed on Thursday for a public holiday
after the S&P 500 U.S. stocks index <.SPX> chalked up a
four-day winning streak, its longest run since May.
Investors would undoubtedly be on the lookout for retail
sales figures for the day after Thanksgiving on Friday,
traditionally the busiest time for retailers. However,
desultory economic conditions may encourage thrift in
consumers.
POLITICAL RISKS BUILD
The willingness of investors to take risks for higher
returns, essential for smooth functioning of markets, has
recovered somewhat from earlier in the month.
However, the last few days have seen a buildup in political
risks in Asia, especially after the Mumbai attacks and
anti-government protestors in Thailand blockaded an airport in
Bangkok.
Thai stocks <> were largely unchanged on a day when
the rest of the region was rallying, 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 rose and indications of heightened aversion to risk
increased 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 yen and Swiss franc, two currencies that are sought
after in times of distress, strengthened the most among major
currencies.
The U.S. dollar fell 0.6 percent to 95.05 yen <JPY=>,
though it was holding above Wednesday's low of 94.60 yen.
Against the yen, the euro fell 0.4 percent to 123.23 yen
<EURJPY=R>.
The dollar was down 0.3 percent against the Swiss franc
<CHF=>.
Gold prices edged higher in the spot market <XAU=>, rising
0.3 percent to $814.55 an ounce, having risen 11 percent in the
last week.
(Additional reporting by Eric Burroughs; Editing by Lincoln
Feast)
