(Corrects stock code for MUFJ in third paragraph)
* MSCI Asia ex-Japan index up 9th day in last 10
* 77 percent of S&P 500 companies so far have beat
forecasts
* U.S. Treasury yields steady ahead of big week of supply
(Repeats to more subscribers)
By Kevin Plumberg
HONG KONG, July 27 (Reuters) - Asian stocks rose for the
ninth day in 10 on Monday, with investors still focused on
upward momentum in corporate earnings and moving money into
riskier, higher-yielding assets.
Oil prices also climbed on optimism about global growth,
with U.S. light crude aiming for a ninth straight session of
rises, heading to $69 a barrel.
In addition to a steady flow of companies reporting results
this week, including Exxon Mobil Corp <XOM.N> and Honda Motor
Co <7267.T> and Mitsubishi UFJ Financial Group <8306.T>,
investors will also look out for U.S. gross domestic product
data for the second quarter, hoping for some indication that a
second-half recovery is on track.
Japan's Nikkei share average <> advanced 1.75 percent
to its highest since June 15, driven by shares of wireless
carrier Softbank <9984.T>, which gained 3.8 percent after the
Nikkei business daily said profit in the April-June period grew
20 percent from a year ago.
"Hopes for corporate earnings are helping shares extend the
rally, while short-covering in stock futures is also giving
them a lift," said Shinji Igarashi, equity manager of the sales
department at Chuo Securities in Japan.
The MSCI index of Asia Pacific stocks outside Japan
<.MIAPJ0000PUS> edged up 1.1 percent to the highest in 10
months, with strength in consumer stocks and the materials
sector.
The index was at the highest since late September, having
risen 67 percent since March 9, when investors began to move
back to equities from cash after a period of intense volatility
spurred by the global financial crisis.
Hong Kong's Hang Seng index <> was up 1 percent, with
financial firms and property developers remaining darlings of
the market.
As of last week, about 3-in-4 of the 184 companies in the
S&P 500 index had reported quarterly results above
expectations, largely due to earnings in the financial sector,
Thomson Reuters data showed.
WILL OIL TAKE A SHOT AT $70
Oil prices looked set to flirt with the psychologically
important $70 a barrel level after having spent almost all of
July trading below it.
The seemingly unquenchable appetite for global equities
along with U.S. dollar weakness in the last few weeks has
improved sentiment on crude, though some analysts wondered how
long oil's support would last.
"Oil's rally has again been supported by external factors,
such as positive macroeconomic data and rally in the equities
markets, and those factors, along with the U.S. dollar, should
again set the tone for oil this week," said Toby Hassall, a
commodities analyst at Commodities Warrants Australia.
"But considering how actual demand in the U.S is still
quite weak, I think there is a downside risk for oil prices."
The ICE Futures U.S. dollar index <.DXY> was largely steady
on the day, though it remained within striking distance of a
one-month intraday low reached last Thursday.
Though equity markets reflected few concerns among
investors about diving further into riskier assets, which
usually would weigh on the safe-haven dollar, positioning may
be a factor preventing acute short-term weakness in the U.S.
currency.
Traders on the International Monetary Market doubled the
value of their net short term position to $16.6 billion in the
week to July 21. []
Such a quick buildup in bets against the dollar may mean
the market is vulnerable to bouts of profit taking.
U.S. Treasury yields were flat compared with late Friday in
New York. The benchmark yield on the 10-year note was at 3.67
percent <US10YT=RR>, having bounced 35 basis points in the last
two weeks as the global equity rally accelerated.
The relative calm in the market masked fears about how a
record $115 billion in new supply will be received this week.
Fear over the expected $2 trillion in supply this year
pushed up benchmark Treasury yields from historic lows in March
when the Federal Reserve announced its $300 billion Treasury
purchase program aimed at lowering interest rates and restoring
growth.
Emerging market central banks and investors, so far, have
basically mopped up the new supply, keeping yields contained.
(Additional reporting by Rika Otsuka in TOKYO and Fayen Wong
in PERTH)
(Editing by Kim Coghill)
