* Markets cheered by spending cut plans in Spain, Portugal
* IBM forecasts of doubling in profits propels tech sector
* Euro hovers near 14-month lows on weak regional growth
* Gold hits another high on inflation worries
* Foreigners return to South Korea stocks
By Umesh Desai
HONG KONG, May 13 (Reuters) - Asian stocks hit highs for
the week on Thursday after new austerity steps pledged by
Portugal and Spain raised hopes that Europe's debt crisis can
be contained, while IBM's strong profit forecast boosted tech
shares.
The optimism was seen carrying into the opening of European
markets with futures for the STOXX Europe 50 <STXEc1>,
Germany's DAX <FDXc1> and France's CAC 40 <FCEc1> up 0.7 to 0.8
percent.
Despite edging higher against the dollar, the euro <EUR=>
struggled near 14-month lows on worries the steep government
spending cuts in parts of Europe would drag on the region's
already feeble economic growth. []
Doubts about the euro's long-term viability and worries
about inflation continued to spur a flight into gold <XAU=>,
which shot to a fresh record for a second day in a row.
The jump to $1,248.15 an ounce brought gold's gains to
nearly 20 percent since early February.
Spain said on Wednesday it will slash civil service pay and
cut public jobs while Portugal's finance minister told Reuters
his government had identified new austerity measures to reduce
its budget deficit, offering investors some reassurances that
those countries are addressing deep-rooted fiscal problems.
[]
"The euro zone problems had really weighed on the market,
and reassurance after the Spanish announcement has allowed
investors to turn their eyes to things like earnings and
economic indicators for the first time in days," said Toshiyuki
Kanayama, a market analyst at Monex Inc in Tokyo.
Japan's Nikkei <> gained 2.2 percent to a one week
closing high as buyers snapped up tech stocks like Advantest,
which makes micro chip testing equipment, and shares of other
companies which have recently released upbeat earnings and
sales outlooks. Advantest jumped 3.3 percent.
While worries remain that Greece and other governments will
not be able to deliver on deeply unpopular spending cuts, there
were signs that recent strains in global money markets were
easing, further buoying investor confidence.
CREDIT MARKET REVIVAL
The three-month dollar London interbank offered rate
(LIBOR) was unchanged after rising steadily during the height
of the worries about Europe's sovereign debt problems. []
Debt capital markets also showed signs of revival in the
region with Macau casino operator Melco Crown Entertainment
<MPEL.O> selling a $600 milllion bond overnight following last
week's jitters over European debt which had issuers postponing
their offerings.
By 0645 GMT, the MSCI Asia ex-Japan index <.MIAPJ0000PUS>
was 2 percent higher after hitting its highest this week with
technology <.MIAPJIT00PUS>, the best performing sector,
outpacing the broad market with a 2.9 percent rise.
Tech bellwether <IBM.N> has forecast it would roughly
double its profit by 2015, fuelling bullishness on the sector.
[]
Tech-heavy stock markets in South Korea <> and Taiwan
<> rose over 2 percent. Both had seen several days of
selling by foreign investors earlier in the week, but data
showed overseas buyers were returning to Korean shares on
Thursday.
In Taiwan, chipmakers Taiwan Semiconductor Manufacturing Co
(TSMC) <2330.TW> and UMC <2303.TW> boosted the main TAIEX share
index <> by as much as 2.4 percent.
"U.S. data and earnings have helped, meaning stocks are
moving on news from abroad," said Chu Yen-min, senior
vice-president at KGI Securities in Taiwan. "This market
correction is on international factors."
The euro edged up 0.4 percent against the dollar, but
traders said any gains were likely to be limited, with some
seeing the currency falling below $1.2400 as it did in 2008.
Traders cited market talk of decent bids in the euro at
$1.2610/20 and also ahead of an option barrier at $1.2600.
"Financial markets overall have been returning to calm but
the euro remains on a downtrend," said Kosuke Hanao, head of
treasury product sales at HSBC in Tokyo.
"Although the panic sell-off in the euro has eased at the
moment, the downside risk still remains," he said.
Meanwhile, the Australian <AUD=> dollar rose as high as as
$0.9020 after data showed the domestic economy added 33,700
jobs in April, handily beating forecasts for a 20,000 rise.
Despite the strong growth numbers, there was little impact
on the Australian rates market since the central bank is
expected to hold rates until November because of the European
worries.
Crude oil futures <CLc1> were 6 cents lower at $75.59 a
barrel, after falling to a low of $75.27.
(Additional reporting by Aiko Hayashi in TOKYO and Jonathan
Standing in TAIPEI; Editing by Raju Gopalakrishnan)
