07/02/2012 - 03:21
* MSCI Asia ex-Japan inches up 0.3 pct, Nikkei falls 0.2 pct
* Euro down 0.1 pct vs dollar
* RBA rate decision due at 0330 GMT
By Chikako Mogi
TOKYO, Feb 7 (Reuters) - Markets edged up on Tuesdayeven as Greek resistance to the strict conditions attached to abailout fund sapped recent momentum spurred by hopes the globaleconomy is improving, but the euro eased on renewed fears of amessy debt default.
Markets remained split over whether the wrangling overGreece's debt restructuring talks would eventually be resolvedor trigger contagion across other vulnerable euro zonecountries, tempering risk-taking investments.
MSCI's broadest index of Asia-Pacific shares outside Japan rose as much as 0.4 percent to its highest inmore than five months, before paring the gains to stand up 0.1percent.
Japan's Nikkei average fell 0.2 percent, slippingfrom a three-month high just shy of 9,000 hit on Monday.
"Concerns over the Greece issue are limiting real risktaking from investors, even if the environment generally appearsto be improving," said Tetsu Emori, a fund manager with AstramaxCo. in Tokyo.
"I'd expect all concerned parties to eventually strike adeal because it is in nobody's interest if Greece defaults. Buta further delay in the debt talks will really hamper sentiment,"he said.
After resisting terms of a proposed new bailout deal whichdemands strict labour reforms and other austerity steps, Greek political leaders face crunch talks on Tuesday to clinch anagreement needed to avoid a debt default.
The full package must be approved by the euro zone, theEuropean Central Bank and the International Monetary Fund beforeFeb. 15 in order to complete legal procedures for a bond swapdeal for a March 20 bond redemption.
Moreover, some euro zone countries require parliamentaryapproval to raise the bailout money.
The euro eased 0.2 percent to $1.3110, havingrecovered from an overnight low of $1.3026.
The dollar was up 0.3 percent against the yen at 76.72. Data from Japan's Finance Ministry on Tuesday confirmedthat Tokyo conducted stealth foreign exchange intervention inOctober-December, even after a massive intervention on Oct. 31when the yen hit a record high around 75.31.
The Australian dollar stood at $1.0710, near asix-month high set last week, ahead of the Reserve Bank ofAustralia's rate decision due at 0330 GMT.
Market players expect a 25 basis point cut due to globalgrowth concerns and a benign inflation environment.
Commodities stabilised after falling the day before when thedollar firmed.
U.S. crude futures inched up above $97 a barrel afterfalling nearly $1 on Monday, while Brent extended gains to above $116 a barrel, supported by increased demand forheating fuel due to cold weather in Europe and persistent supplyconcerns.
Spot gold was up 0.2 percent to $1,723 an ounce,helped by a modest recovery in equities.
But Asian credit markets remained subdued, with the spreadson the iTraxx Asia ex-Japan investment grade index little changed, after tightening sharply on Monday.
Analysts expect consolidation in several markets which haverecently climbed to near resistance levels, which may then pavethe way for a break higher.
India's main 30-share BSE index is expected to find major resistance at 17,908, a high in October, after rising ashigh as 17,829 on Monday.
Shanghai shares need to break above 2,360 for aneventual move higher, while a fall below 2,240-50 will reset thedowntrend. The shares fell 1.4 percent to 2,297 on Tuesday.
Emori said gold and oil have more upside scope than otherassets.
Interbank lending rates in Europe continued to improvedespite the Greece issue, largely due to the ECB's generousfunding in December and expectations ahead of another suchliquidity operation scheduled for later this month.
Three-month Euribor rates, traditionally themain gauge of unsecured interbank euro lending and a mix ofinterest rate expectations and banks' appetite for lending, fellon Monday to 1.094 percent from 1.102 percent, hitting thelowest level since late February last year. (Additional reporting by FX analyst Krishna Kumar in Sydney;Editing by John Mair)
