* Asian stocks excluding Japan rise to fresh 3-month highs
* Oil pressured as Syria worries recede further
* China industrial output, retail sales add to optimism
* European stocks seen opening higher
By Ian Chua
SYDNEY, Sept 10 Asian stocks rose to three-month
highs on Tuesday in the face of fresh evidence suggesting China
could be emerging from an economic slowdown while receding fears
of a U.S. military strike against Syria kept oil prices under
European stocks were seen tracking gains in Asia with
financial spreadbetters expecting Germany's DAX to open
up as much as 0.5 percent.
Russia's proposal to work with Damascus to put its chemical
weapons under international control could avert planned U.S.
action. It prompted President Barack Obama to say he saw a
possible breakthrough in the crisis.
Benchmark Brent oil prices fell 0.8 percent to
$112.85 a barrel, extending Monday's 2.1 percent slide. U.S.
crude slipped 1.0 percent to $108.44.
Lower oil prices are usually a positive development for
Asia, a region that relies heavily on imports for its energy
MSCI's broadest index of Asia-Pacific shares outside Japan
rose 1.2 percent, extending Monday's 1.3 percent
gain to reach highs not seen since early June.
Tokyo's Nikkei closed 1.5 percent higher, adding to
Monday's 2.5 percent rally as news that Tokyo had won the right
to host the 2020 Olympic Games bolstered optimism for a lasting
MORE CHINA DATA
Upbeat Chinese industrial output and retail sales data on
Tuesday added to growing evidence that China's economic slowdown
may have bottomed out.
"China's August real activity data came in stronger than
expected, which will help sustain the market rally due to
improving market sentiment towards China's economy," said
Li-Gang Liu, chief economist of Greater China at ANZ in Hong
A recent run of encouraging factory activity data from
China, Europe and the United States suggested the global economy
as a whole was on a firmer footing.
In a slight twist to this narrative, sentiment for emerging
markets also found support in disappointing U.S. jobs data for
August because it raised doubts about whether the Federal
Reserve can scale back stimulus in any significant way next
A Reuters poll on Monday showed economists generally expect
the Fed to announce a reduction in its massive $85 billion
monthly bond-buying programme by a very modest $10 billion.
Such an outcome should be good news for emerging markets,
which have suffered from an outflow of funds as investors
positioned for a world with less easy money from major central
The MSCI emerging equities index advanced 1.1
percent to three-month highs and has rallied nearly 5 percent in
the last five trading sessions.
Still, this may only be a short-term bounce, warned Societe
Generale strategist Benoit Anne.
"I don't buy the argument that the global emerging market
correction is over. Outflows have been robust over the past few
weeks and are showing no signs of reversal," he wrote in a
The disappointing U.S. jobs data has cast a long shadow on
the dollar, which was subdued after two straight days of
declines. It wallowed at a 1-1/2 week low against a basket of
major currencies, having fallen 1 percent since Friday.
Adding to the uncertainty, San Francisco Federal Reserve
Bank President John Williams said on Monday he hasn't made up
his mind yet over whether to support a reduction in Fed bond
The weakened dollar helped the euro recover from last week's
selloff sparked by dovish comments from the European Central
Bank. The common currency was steady at $1.3271, keeping
close to a 1-1/2 week peak of $1.3281 scaled on Monday.
The greenback fared better against the yen, which sagged on
Monday as the Nikkei rallied. The Japanese currency has tended
to move inversely to the Nikkei this year.
The dollar was flat on the day at 99.64 yen, but down
only moderately from a pre-jobs data high of 100.24 set on
Analysts at BNP Paribas said it was too early to turn
bearish on the dollar. "This is more of a temporary setback than
a game-changer for USD bulls," they wrote in a note.
They cited Fed tapering risk, the chance of U.S. data
surprising to the upside and the possibility of Larry Summers
being nominated for the Fed Chairman position as dollar-positive
Summers is seen as more hawkish than Fed Vice Chair Janet
Yellen, who is also in the running to be the next Fed chief.
Copper was a touch softer at $7,178.00 a tonne,
having climbed from last week's trough of $7,082 on optimism
Spot gold was slightly weaker on the day at $1,377.61
an ounce, still in consolidating after its late-June to
late-August rebound from $1,180.71 to $1,433.31 fizzled out.