* MSCI Asia ex-Japan at 16-month peak, Nikkei at near 8-mth
* Dollar broadly pressured ahead of Fed outcome
* Liquidity hopes underpin commodities prices
* North Korean rocket launch shrugged off
* European shares expected to rise
By Chikako Mogi
TOKYO, Dec 12 Asian shares rose on Wednesday
buoyed by strength in global equities markets, hopes of a deal
from U.S. budget talks and expectations for more stimulus from
the Federal Reserve when it ends its two-day policy meeting
later in the day.
Oil, copper and gold prices were also underpinned while the
dollar remained broadly pressured, but the yen weakened against
the dollar on expectations the Bank of Japan will take
additional easing steps at its policy meeting next week.
European shares were expected to climb, with financial
spreadbetters predicting London's FTSE 100, Paris's
CAC-40 and Frankfurt's DAX will open as much as
0.4 percent higher. But a 0.1 percent drop in U.S. stock futures
hinted at a soft Wall Street open.
MSCI's broadest index of Asia-Pacific shares outside Japan
gained 0.5 percent to a 16-month peak. The index
has hit successive 16-month highs since Dec. 5.
Australian shares were up 0.2 after touching a
nearly 17-month peak, as higher commodities prices lifted the
London copper steadied at $8,103.50 a tonne, near
two-month highs, while spot gold inched up 0.1 percent to
$1,710.65 an ounce. U.S. crude futures were little
changed at $85.81 a barrel and Brent rose 0.2 percent to
"No doubt about it, the liquidity from the U.S. Fed is a
good driver for prices," said Henry Liu, head of commodity
research at Mirae Asset Securities in Hong Kong, adding that
copper is also supported by a recovery in China and the United
While mainland markets remained sluggish, Hong Kong shares
rose to a 16-month high, underpinned by foreign
investors' optimism on China.
In China, "it's tough to get a clear picture of what's
happening on the ground but you can infer that domestic
investors remain relatively pessimistic," a Hong Kong-based fund
South Korean shares added 0.6 percent, shrugging off
news that North Korea launched the second rocket this year
earlier on Wednesday.
Japan's Nikkei share average rose 0.6 percent to end
at its highest in nearly eight months, led by gains in tech
shares and other exporters on the weak yen.
The euro popped back above $1.3000, pulling away from
a two-week low of $1.2876 plumbed on Friday.
The Fed is expected to announce a fresh round of bond buying
as part of its efforts to support a fragile economic recovery
threatened by political wrangling over the government's budget.
The central bank looks certain both to extend its purchases of
mortgage-backed debt and replace another expiring stimulus
programme with a new bout of money creation.
Against the yen, the dollar rose 0.2 percent to 82.65 yen
Data on Wednesday showed Japan's core machinery orders rose
2.6 percent in October from the previous month, up for the first
time in three months but below a 3 percent rise forecast,
highlighting how uncertainty over the global outlook continued
to weigh on business investment and the broader economy.
India's industrial production, in contrast,
soared by 8.2 percent in October from a year earlier, government
data showed on Wednesday, well above a 4.5 percent rise
Investors also closely followed developments in U.S. budget
talks to avert the "fiscal cliff," some $600 billion of tax
hikes and spending cuts scheduled to start in January, which
economists have warned could send the U.S. economy into
recession and drag down the fragile global economy.
Negotiations to avert the "fiscal cliff" ahead of a year-end
deadline intensified as President Barack Obama and U.S. House of
Representatives Speaker John Boehner spoke by phone on Tuesday
after exchanging new proposals, in a possible sign of progress
ahead of the end-of-year deadline
A group of high-profile chief executives urged President
Barack Obama and Republican congressional leaders on Tuesday to
strike a deal, reflecting mounting urgency to resolve the issue
with time running out.
"Definitely the momentum is to the upside," said Stan Shamu,
a market analyst at IG Markets. "Everyone seems to be pricing in
a fairly positive outcome to the fiscal cliff negotiations as