* Nikkei bounce falters, despite upbeat corporate earnings
* Yen and bonds edge higher again as investors favour safety
* Wall St steadier but US stock futures in the red
By Wayne Cole
SYDNEY, Feb 5 Asian shares struggled to sustain
the slimmest of rallies on Wednesday as a hesitant performance
by the Japanese market fuelled fresh demand for safety in the
yen and top-rated bonds.
Dealers had cautioned that the mood remained brittle and it
would only take a poor U.S. payrolls report on Friday to set the
bears running again.
The ADP reading on private hiring is due later on Wednesday
and any disappointment will be taken badly by investors.
The strain was clearly taking a toll with the Nikkei
rising, falling, then rising again to be up 1.1 percent at
14,163. It never even got close to testing resistance at the
200-day moving average of 14,425, while there remains a large
gap to fill between Monday's close and Tuesday's opening.
The index has shed 14 percent since the start of the year
following last year's 50 percent boom.
The faltering performance was all the more disappointing as
some major corporate names reported upbeat earnings. Panasonic
Corp jumped 17 percent after its quarterly earnings
more than tripled, while Toyota Motor Corp rose 5
percent after predicting record annual profits.
MSCI's broadest index of Asia-Pacific shares outside Japan
swung to a 0.3 percent loss, while South Korea
could only eke out a gain of 0.4 percent.
On Wall Street, the Dow had ended Tuesday up 0.47
percent, while the S&P 500 added 0.76 percent. But stock
futures were trading lower on Wednesday with the S&P e-mini
contract off 0.3 percent.
The underwhelming bounce in the Nikkei led investors to
again bid up the safe haven yen, with the dollar easing to
101.46 yen from an early top of 101.77.
The euro eased a touch to $1.3510, still dogged by
speculation that the threat of deflation might nudge the
European Central Bank into easing policy at its meeting on
The major mover in currencies was the Australian dollar
which surged after the country's central bank on Tuesday shut
the door on further rate cuts, citing a pick-up in housing and
consumption and higher than expected inflation.
The Aussie was enjoying the view at $0.8890 after
climbing a steep 2 percent overnight. It also rallied sharply on
the euro and yen as speculators were forced to cut short
positions in what had been a very crowded trade.
The New Zealand dollar got its own boost when jobs
data showed strong employment growth for the fourth quarter of
last year, adding to the already considerable case for a hike in
The reluctance to take risks led to demand for U.S.
Treasuries, with the 10-year yield ticking down to 2.61 percent
, not far from the recent three-month lows at 2.57
Gold failed to get much of a boost and remained
sluggish at $1,252.89 an ounce.
In commodities, prices for wheat were boosted by dry weather
and declining crop conditions in the United States, while
soymeal and corn were in high demand.
Broad gains in grains and natural gas lifted the Thomson
Reuters/Core Commodity Index 1 percent, the biggest
one-day gain in nearly a month.
U.S. oil futures rose on bets on a reduced stockpile
at a key delivery point due to the start-up of a major pipeline.
The March NYMEX contract added 44 cents to $97.63 a
barrel, while Brent crude rose 22 cents to $106.00.