* Japan central bank buys shares from banks
* Australia announces $26.5 billion second stimulus package
* Yen, US Treasuries slip as risk taking returns slowly
* China still top for investors among emerging markets-EPFR
By Kevin Plumberg
HONG KONG, Feb 3 (Reuters) - Asian stocks rose and the yen
fell on Tuesday, helped by increasingly aggressive efforts by
governments that were pouring out cash and investment to
stabilise markets and support their economies.
Japan's central bank said it would buy $11.2 billion worth
of badly performing shares off the books of the country's
struggling financial institutions, supporting equities and
weighing on safe-haven U.S. Treasuries. []
"When taken alone, this is positive for shares and is
likely to lead to an easing of risk aversion. It is a factor
that is positive for stocks and negative for the yen," said
Tomoko Fujii, head of economics and strategy, Japan for Bank of
America in Tokyo.
Technology stocks, some of whom were beaten down the
hardest during the worst days of 2008, led the modest rally in
equities, which in turn helped investor willingness to take
risks and lift higher-yielding currencies such as the
Australian and New Zealand dollars.
The MSCI index of stocks in Asia-Pacific excluding Japan
<.MIAPJ0000PUS> rose 1.05 percent. The healthcare, materials
and technology sectors were the biggest percentage gainers
among the sectors in the region.
Australia's benchmark S&P/ASX 200 index <> was one of
the biggest gainers in the region, rising 1.5 percent. Shares
of Commonwealth Bank of Australia Ltd <CBA.AX> provided a large
boost to the index, up 8.9 percent after the bank provided a
not-as-bad-as-expected profit forecast. []
Japan's Nikkei share average <> inched up 0.1 percent,
after a 1.3 percent rise overnight in the Nasdaq inspired some
bargain hunting among tech shares.
However, shares of Japan's largest bank fell 1.9 percent
after a newspaper reported Mitsubishi UFJ Financial Group will
slash its annual forecast and join an increasing number of
companies ratcheting down their expectations as the impact of
global recession is fully felt.
Hong Kong's Hang Seng index <> climbed 1.3 percent,
helped by Chinese stocks, which were rising on speculation of
further stimulus from Beijing.
BIG GOVERNMENT PAYS OUT
Hopes the White House will in addition to pumping more than
$800 billion of stimulus into the economy also create a new
fund to house bad bank debt have been redirecting investors'
capital back into equity markets.
Last week equity funds around the world saw $1.56 billion
in fresh money, bonds funds took in $35 million and money
market funds received $6.8 billion, according to Boston-based
EPFR Global, which tracks $11 trillion in total assets.
Among large emerging markets, investors continued to favour
China by and far.
"Since the New Year there has been a clear split in the
fortunes of the four BRICs markets, with investors gravitating
towards China and Brazil at the expense of Russia and, to a
lesser extent, India. China Equity Funds absorbed $43 million
for the week, the eighth time in 10 weeks they have recorded
inflows," the firm said in a note.
In the currency market, the dollar rose 0.4 percent on the
day against the yen to 89.80 yen <JPY=> and the euro climbed
0.5 percent to 115.60 yen <EURJPY=> on hopes the action by the
Bank of Japan will help to stabilise the markets and ease risk
aversion.
The Australian dollar strengthened against the dollar and
yen, after the Australian government also unveiled a $26.5
billion economic stimulus package that included a one-off cash
handout and infrastructure spending. []
After rallying overnight on a raft of dour economic
reports, U.S. Treasuries came under pressure during Asian hours
after the Bank of Japan's latest efforts.
The benchmark 10-year note's yield <US10YT=RR>, which moves
in the opposite direction of the price, ticked up to 2.75
percent from 2.72 percent late on Monday in New York.
U.S. crude oil futures held steady above $40 a barrel,
after falling nearly 4 percent a day earlier due to economic
gloom and after U.S. refinery workers averted a strike that
would have slashed fuel production.
Crude for March delivery was trading around $40.46 a
barrel, up 38 cents on the day <CLc1>. []
(Editing by Kazunori Takada)
