* Asia stocks up 3.2 percent, tech shares lead
* Fresh Japanese stimulus plan boosts Nikkei, hurts JGBs
* Aussie swap rates edge up despite dour jobs data
(Repeats to more subscribers)
By Eric Burroughs
HONG KONG, April 9 (Reuters) - Asian stocks pushed back
towards a six-month high on Thursday as technology shares
resumed their rally, while Japan's surprisingly big stimulus
spending and signs of stabilising economic activity drove up
government bond yields.
European indexes were set to rise between 1 percent and 1.5
percent, tracking gains in Asia and in U.S. markets overnight,
according to financial bookmakers.
Japan's Nikkei share average <> jumped 3.7 percent
after the government announced a bigger-than-expected stimulus
package of $154 billion, or about 3 percent of GDP. The news
hurt Japanese government bonds on worries about big supply to
pay for the spending. []
The Japanese spending package will target eco-friendly
electronics, giving a boost to shares of companies such as Sony
Corp <6758.T> and Panasonic Corp <6752.T>.
The package will add to spending of 12 trillion yen already
planned under previously announced stimulus measures, taking
Japan's total stimulus spending to combat the global financial
crisis to around 5.5 percent of GDP.
But the rally in shares, worries about bond supply and
signs that some central banks may have finished cutting
interest rates kept pushing up bond yields and swap rates
across the region -- complicating the efforts of central banks
to keep credit cheap.
The Bank of Korea kept rates on hold at 2 percent, a record
low. The BOK said there was still room to cut rates but also
that the economy was levelling off after its rapid decline.
[]
The upbeat comments sparked a 4.3 percent rally in the
KOSPI <> to a six-month closing peak.
Some economic data around the region also provided hope for
a recovery. Japanese core machinery orders posted a surprising
increase of 1.4 percent in February from the previous month,
while business surveys in China suggested the economy is
steadying.
China remains the economic engine helping offset the
collapse in exports across Asia thanks to its nearly $600
billion stimulus spending, which has spurred orders for
technology goods across Asia.
"Recent data from China has been positive relative to
expectations," said Patrick Bennett, Asia FX and rates
strategist at Societe Generale in Hong Kong.
"The positive surprises in recent Australian, Korean,
Taiwanese and Brazilian trade data have been underpinned by
improving shipments to China."
Shares in tech-heavy Taiwan <> -- one of the best
performing stock markets in the world this year -- helped lead
the rise in Asia as companies such as contract chip maker UMC
<2303.TW> <UMC.N> jumped on signs of improving demand.
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> rose 3.2 percent, snapping a two-day fall and
back near a six-month peak. Showing greater investor
confidence, volumes rose on the hefty gains.
The MSCI index has now rebounded 31 percent from lows hit
in early March.
U.S. S&P 500 futures <SPc1> were up 1.2 percent after solid
gains on Wednesday.
Investors in many financial centres are now taking a break
for Easter holidays. Markets in Australia, Hong Kong and
Singapore are closed on Friday.
RISING RATES
Australian swap rates edged up despite data showing
joblessness jumped in March by the most since the 1991
recession, putting more pressure on the Reserve Bank of
Australia to cut rates further after a quarter-point trim to 3
percent earlier this week. []
"This is a very weak report and strengthens the case for
more rate cuts," said Brian Redican, senior economist at
Macquarie in Sydney.
Three-year Australian swap rates <AUDIRS> edged up 2 basis
points 4.033 percent, keeping the swap curve between one- and
three-year rates near its steepest levels in a decade as
investors still doubt how much more the RBA will cut rates.
The rise in interest rates helped limit the fall in the
Australian dollar, which rose 0.7 percent to $0.7150 <AUD=D4>
and recovered from an initial fall to $0.7051 on the data.
The yen slid across the board as rising stocks prompted
market players to put on carry trades favouring higher-yielding
currencies.
Most analysts said the RBA was likely to cut rates more
deeply to limit the jump in unemployment.
Bond markets around the world have suffered from the
massive supply looming ahead, even as central banks such as the
Federal Reserve have taken the extraordinary step of buying
government bonds outright to keep long-term yields low.
Japanese government bonds were spooked as the government
said it would issue 10-11 trillion yen to pay for the new
stimulus spending, about twice what analysts had expected.
The 10-year JGB yield <JP10YTN=JBTC> edged up 2 basis
points to 1.475 percent and hit a five-month high of 1.480
percent, extending a rise despite the Bank of Japan having
increased its monthly purchases of debt.
Elsewhere, the U.S. dollar climbed 0.4 percent to 100.10
yen <JPY=> but slipped slightly to $1.3303 to the euro <EUR=>.
Crude oil prices rose $1.11 a barrel to $50.49 <CLc1> after a
large draw in U.S. energy inventories.
