* Nikkei edges up from 16-mth lows, helped by
short-covering
* Yen stays below 15-yr high vs dlr, Japan action in focus
* U.S. economy worry keeps markets in check; gold hits
highs
* Eyes on U.S. jobless claims, GDP revisions, Jackson Hole
By Aiko Hayashi
TOKYO, Aug 26 (Reuters) - Asian stocks rose on Thursday as
investors hunted for bargains among recently beaten-down
shares, while the yen pulled further away from 15-year highs as
investors wondered whether Japanese officials would take fresh
steps to curb the currency's strength and spur economic growth.
European stocks <> opened nearly a percent higher
after hitting a five-week closing low in the previous session,
drawing strength from a late rebound on Wall Street overnight,
but with some caution lingering over the outlook for the
economy.
Exposure to riskier assets continued to weigh on markets
after U.S. data on Wednesday heightened fears that the world's
biggest economy may be at risk of sliding back into recession.
U.S. new home sales slumped to the slowest pace on record
in July and durable goods orders were weaker than expected,
suggesting growth could slow sharply without more government or
central bank support. []
"There are increasing signs of a slowing global economy, and
on top of that you have Japan's situation where it really isn't
providing policy to deal with its economic issues," said
Kenichi Hirano, operating officer at Tachibana Securities.
"Otherwise, why is the Nikkei performing so poorly? As
corporate earnings showed, the economy itself is not doing
badly enough to warrant the current weakness in shares, but the
lack of clarity on the yen's strength is not good."
The Nikkei <> rose 0.7 percent, lifted by what market
players said was short-covering and buying of futures by
long-term domestic investors, after hitting a 16-month closing
low on Wednesday.
But gains were capped by doubts about how much policymakers
could really do to turn the ailing economy around, as well as
fears of longer-term policy inaction prompted by a murky
political outlook. []
Japan's government will urge the Bank of Japan to ease
monetary policy further as part of a package of steps to stem
the yen's rise and support the economy, the Asahi newspaper
said, ratcheting up pressure on the central bank to take action
before a policy meeting next month.
Japan has also not ruled out market intervention to weaken
the yen, though markets largely doubt such a move or further
symbolic BOJ policy easing would have much effect.
The benchmark Nikkei broke below 9,000 this week for the
first time since May 2009. The 9,000 to 9,100 area had been
strong support since last year, and market players say there
will be few technical targets to break the benchmark's further
falls.
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> rose more than half a percent, led by consumer
staples and healthcare, while those most sensitive to business
cycles such as technology eked out smaller gains.
The regional gauge hit a 1-month low in the previous
session and is down about 4 percent so far this year, but has
held up better than the all-country world index, which has
fallen 7 percent <.MIWD00000PUS>.
Asia's strong economic growth apart from Japan has been a
buffer against recent global shocks, with emerging markets
continuing to attract foreign investors despite a broader
aversion to riskier assets for much of the year.
Investors are awaiting U.S. jobless claims data, due later
in the day, and watching for news from the Federal Reserve's
yearly conference at Jackson Hole, Wyoming this week, though
analysts do not expect Fed Chairman Ben Bernanke to give many
clues on specific plans. []
The gathering takes place at a time when U.S. gross
domestic product revisions are likely to show the world's
largest economy grew much more slowly in the second quarter
than originally reported. Both U.S. and U.K. GDP revision
figures are set to be announced on Friday. []
YEN FOR ACTION?
News that Bank of Japan Governor Masaaki Shirakawa will
attend the Federal Reserve conference this week was making some
players hesitant to push the yen higher, analysts said.
[]
The dollar rose 0.2 percent from late U.S. trade to 84.71
yen <JPY=>, having risen from a 15-year trough of 83.58 yen
struck on trading platform EBS on Tuesday.
"Investors are cautiously watching if Japanese authorities
will do something," said Hideki Amikura, deputy general manager
of the forex section at Nomura Trust and Banking.
Shirakawa is likely to speak to Bernanke and other central
bankers in Jackson Hole, and that is prompting market players
to speculate about possible Japanese action."
But even if Japan's government acted alone to try to halt
yen strength, dealers have been sceptical it could reverse the
growing unwillingness among investors to take risks that has
been behind the yen's 10 percent rise against the dollar so far
this year. []
Talk has been growing that Japan may intervene to stem the
yen's rise for the first time since March 2004 as the currency
nears an all-time high of 79.75 yen to the dollar hit in 1995,
pushing the Nikkei average down to 16-month lows.
The euro further recovered from a nine-year trough against
the yen after data on Wednesday showed that business morale in
Germany improved to its highest in more than three years in
August, offsetting concerns about fiscally weak euro zone
countries. []
The euro climbed 0.6 percent on the day to 107.70 yen
<EURJPY=R> and rose 0.5 percent against the dollar to $1.27150
<EUR=>.
Despite the day's gains in Asian stock markets, however, a
clear falling trend in government bond yields around the world
reflects deep unease that the chances of another recession are
growing.
The benchmark 10-year Japanese government bond yield
<JP10YTN=JBTC> rose 4 basis points to 0.940 percent on falls in
U.S. Treasury prices and profit-taking, but analysts said they
expect yields to remain on a downtrend on lingering easing
hopes.
U.S. crude oil <CLc1> rose for a second day, nearing $73 a
barrel, as bargain-hunting and short-covering in equities
spread to the oil market.
Gold <XAU=> edged up to $1,240.95 an ounce, after hitting
its strongest level in eight weeks on persistent worries the
U.S. recovery was stalling.
(Additional reporting by Elaine Lies and Rika Otsuka in
Tokyo)
(Editing by Kim Coghill and Mathew Veedon)
