GLOBAL MARKETS-Stocks take China tightening in stride, euro falls

                                
 * Euro decline seen limited on rate differential story
                                
 * More gains for emerging Asian FX seen - PIMCO
                                
 * Gold hits another record, ETF holdings rise

                                
 By Saikat Chatterjee	
                                
 HONG KONG, April 18 (Reuters) - Asian stocks rose on Monday
as investors bet that China's latest round of policy tightening
won't dent prospects of a global economic recovery while the
euro weakened on a broad wave of profit-taking.	
                                
  China on Sunday raised banks' reserve requirements for the
fourth time this year. The move was not a surprise as market
players had predicted more tightening after last week's data
showed an acceleration in inflation. [ID:nL3E7FH05Y].	
                                
 Beijing's latest policy action is a sign that authorities
across the region are intensifying their battle, using interest
rate increases and strengthening currencies, to rein in imported
inflation due to rising commodity prices.	
                                
 Singapore sanctioned an increase in the value of its
currency last week while the Bank of Thailand is likely to raise
interest rates at a review on Wednesday.	
                                
 In a sign that Beijing's latest action was well anticipated,
both Chinese and Hong Kong stocks were trading
higher on the day after opening lower.	
                                
 	
                                
 	
                                
 	
                                
 GOOD PERFORMER	
                                
 Shanghai has been the best performing stock market so far
this year with gains of about 9 percent as authorities have
repeatedly raised reserve requirements and increased rates. In
contrast, India's troubles in tackling inflation have  
                                
seen that market decline by 5.5 percent on a year-to-date
basis.	
                                
 Elsehwere, Japan's Nikkei dipped, weighed by
declines in telecommunications shares. Outside Japan, MSCI's
index of Asia Pacific shares edged higher.
Korean shares hit another record high.	
                                
 With stronger currencies being used as a weapon to tackle
inflation, investors are adding exposure to the Chinese yuan
 and the Singapore dollar and have turned bullish
on the South Korean won's outlook .	
                                
 PIMCO, the world's biggest bond fund manager, said the yuan
and the won are "fundamentally undervalued". [ID:nL3E7FI03R]	
                                
 	
                                
 EURO WEAKENS	
                                
 The euro suffered broad losses as a raft of bad news in the
form of Finland's anti-euro party making big gains in a
parliamentary election on Sunday and talk of a Greek debt
restructuring prompted traders to take profits into a recent
rally. [ID:nLDE73G02L]	
                                
 "This probably mostly has to do with market sentiment. In
the end, I think what it probably boils down to is that there
are still some long positions in the euro," said Koji Fukaya,
director of global foreign exchange research for Credit Suisse
Securities in Tokyo, referring to the euro's drop.	
                                
 But the common currency is expected to be supported by
prospects of another interest rate hike after the recent quarter
point increase, as data showed euro zone inflation climbed
higher than expected in March. [ID:nLDE73E12U]	
                                
 In contrast, the Fed is expected to continue with its ultra
easy policy stance, encouraging investors to search for
high-yielding currencies elswhere.       	
                                
 In commodities, gold rose to yet another record high,
building on four consecutive weeks of gains, powered by rising
inflation pressures and a weakening dollar. Holdings in the SPDR
Gold Trust , the world's largest gold-backed
exchange-traded fund, rose too. [ID:nL3E7FI013]	
                                
 U.S. crude futures <CLc1> headed lower towards $109 a barrel
as traders took profits after three days of gains despite
comments by Saudi Arabia confirming a cut in crude production to
counter an oversupplied market. Prices have retreated slightly
after hitting a 2-1/2 year peak of $113.46 earlier this month.	
                                
 London copper prices briefly dropped half
a percent while Shanghai copper prices <SCFcv1> also dipped
slightly after Beijing's latest round of tightening.	
                                
 Notwithstanding the commodities rally, U.S.
Treasury yields declined as recent data showed underlying U.S.
inflation pressures remained subdued. Ten-year yields
 edged a basis point lower to 3.40 percent after
falling 9 basis points on Friday.	
 	
                                
* For Reuters Global Investing Blog, click on 	
                                
 http://blogs.reuters.com/globalinvesting 	
                                
* For the MacroScope Blog, click on 	
                                
 http://blogs.reuters.com/macroscope 	
                                
 * For Hedge Fund Blog, click on 	
                                
 http://blogs.reuters.com/hedgehub   	
	
 (Additional reporting by Masayuki Kitano and Jongwoo Cheon in
SINGAPORE and Ian Chua in SYDNEY; Editing by Richard Borsuk)