* Stocks extend gains, but energy muted before more
earnings
* Explosions at Jakarta hotels weigh on local shares,
rupiah
* Dollar hovers near six-week low
* Oil falls back
By Elaine Lies
TOKYO, July 17 (Reuters) - Most Asian shares extended gains
on Friday as key U.S. earnings reports beat expectations,
fueling hopes that the global recession is receding, but deadly
explosions at two Jakarta hotels weighed on Indonesia stocks
and the rupiah.
The yen gained broadly and oil and gold edged down.
The blasts at the Ritz-Carlton Hotel and the Marriott Hotel
in central Jakarta killed six people, sending Jakarta stocks
<> down 2 percent and lopping 0.7 percent off the rupiah
<IDR=>, which has been Asia's best performing currency so far
this year. []
Strong earnings for major U.S. companies continued to cheer
global markets as the quarterly reporting season moved into
higher gear, pushing U.S. share indexes up about 1 percent
overnight.
JPMorgan Chase & Co <JPM.N> saw quarterly profit soar 36
percent and U.S. bellwether International Business Machines
Corp <IBM.N> strongly beat forecasts in earnings announced
after the bell. []
Share markets have been keenly watched as a barometer of
investor confidence, and market players were keeping a wary eye
on earnings due out later on Friday, including Citigroup <C.N>
and Bank of America <BAC.N>.
"Earnings from U.S. banks have been upbeat, but there are
concerns that the positive results could be limited to the
second quarter," said Takahiko Murai, general manager of
equities at Nozomi Securities.
"Some institutions appear to hold significant bad loans and
third quarter results may not be as encouraging," he added.
Amid the good news, JP Morgan reported a surge in consumer
credit losses, showing the economic recovery still has a long
way to go, and Citigroup and Bank of America were expected to
post relatively weaker performances, one trader said.
Asian shares ex-Japan rose 0.4 percent after recording
their highest close in a month on Thursday. <.MIAPJ0000PUS>
Asia ex-Japan equity funds were the only ones of the four
major emerging markets fund groups to see inflows during the
second week of July, according to global fund tracker EPFR,
while Japan equity funds recorded inflows for the third
straight week.
Japan's benchmark Nikkei <> clawed up 0.4 percent to
9,383.50. Gains have been limited by political uncertainty
since Monday, when embattled Prime Minister Taro Aso said he
aimed to call an election for Aug. 30, despite grim prospects
for his long-ruling conservative party. []
Nissan Motor <7201.T> climbed 2.2 percent after the Nikkei
business daily said Japan's third-largest automaker aims to
develop its own hybrid technology for small and mid-size cars
and will launch a vehicle using that system in Japan in 2011
[]
Australian shares gave up early gains to edge down 0.1
percent, ending a three-day rise, on concerns the recent rally
may have pushed the market beyond what is justified by improved
earnings expectations.
Hong Kong shares <> rose 1 percent.
YEN GAINS, DOLLAR ABOVE SIX-WEEK LOWS
The yen edged up against a range of currencies, though it
was not immediately clear how much of this was due to the
Jakarta explosions, with traders divided on whether the news
had an impact on financial markets.
The Indonesian rupiah <IDR=> fell 0.7 percent to 10,200 per
dollar, prompting state banks to sell dollars to support it,
trades said.
"There was a bit of panic in the market this morning after
the explosions and investors tried to cover their short dollar
positions," said a trader in Jakarta, noting that the market
had been quite short on the dollar.
The dollar, which has been a defensive play for investors
in the global economic crisis, hit a six-week low at 79.131
against the basket of six currencies <.DXY> on Thursday.
It later rebounded after data showed factory activity in
the U.S. mid-Atlantic region contracted for a 10th straight
month in July, and was holding at 79.432 at 0212 GMT.
[] and []
But the greenback edged down against the yen, slipping 0.3
percent to 93.61 <JPY=>. The Australian dollar slipped 0.9
percent to 74.81 yen <AUDJPY=> while the kiwi edged down 0.7
percent to 60.27 yen. <NZDJPY=>
Yields on U.S. 10-year Treasury notes <US10YT=RR> stood at
3.550 percent, down nearly one basis point from U.S. trade but
up from a two-month low of 3.26 percent hit on Monday.
September JGB futures rose 0.06 point to 138.65 <2JGBv1>
after a smooth five-year debt sale on Thursday, still down from
a 3-1/2-mth peak of 138.97 hit last week.
(Editing by Kim Coghill)
(Additional reporting by Shinichi Saoshiro, Charlotte Cooper
and the Jakarta newsroom)
