* Dollar index holds steady after gaining on higher yields
* Spreadbetters see lower open for Europe
* Carry trades keep Aussie near 6-mth high vs euro
By Shinichi Saoshiro
TOKYO, June 10 Asia stocks rose to three-year
highs on Tuesday on optimism over global growth prospects and a
record run on Wall Street, which helped lift Treasury yields and
Monetary easing by the European Central Bank last week also
has whetted the appetite for riskier assets globally, with an
upbeat U.S. nonfarm payrolls report on Friday giving further
impetus to investors.
On Wall Street overnight the S&P 500 ended at a
fourth straight record closing high and the Dow at its
Spreadbetters expected the European equities to take a
breather from their recent advances, forecasting Britain's FTSE
to open as much as 0.3 percent lower, Germany's DAX
down 0.2 percent and France's CAC almost flat.
There was muted market reaction to Chinese inflation data
released earlier in the day, as it remained well within the
governments' comfort zone, giving room for the government to
launch fresh stimulus measures if needed to support the economy.
China's consumer prices rose 2.5 percent in May from a year
earlier while producer prices fell 1.4 percent.
"No surprises again from May inflation data. Producer prices
stabilised whereas consumer inflation continues to be driven by
food prices. The core measure is unchanged, pointing to muted
inflationary pressure," said Andy Ji, senior Asian currency
strategist at Commonwealth Bank of Australia in Singapore.
"The set of numbers has no implication on monetary or
exchange rate policies, in our view."
Recent global manufacturing data have largely highlighted
improving economic conditions, with China's exports also showing
a bounce in May.
MSCI's broadest index of Asia-Pacific shares outside Japan
was up 0.3 percent after touching 493.54, its
highest since June 2011. Australian shares rose 0.1
Tokyo's Nikkei bucked the trend and lost 0.7 percent
as profit taking kicked in after it advanced to a three-month
high on Monday.
"The week ahead is likely to be a quiet one for emerging
market asset prices as the focus shifts to the World Cup,"
strategists at Brown Brothers Harriman wrote in a note to
"Still, central banks continue to occupy the centre stage
after Mexico's surprise cut and Brazil's extension of its forex
intervention program last week. Many are looking for the Korean
central bank to step up its forex interventions as USD/KRW
breaks below the key 1020 level," they said.
The South Korean won strengthened to below 1020 to
hit a near six-year peak against the dollar, supported by
persistent inflows into the stock market, although participants
were wary of official intervention.
The dollar continued to benefit from rising U.S. Treasury
yields. The dollar index, which measures the greenback's
strength against a basket of key currencies, held steady after
rising 0.2 percent on Monday.
The dollar stood little changed at 102.35 yen. The
euro was also flat at $1.3587 after shedding nearly 0.4
percent on Monday.
The Australian dollar hovered near a six-month high against
the euro as yield hungry investors piled into carry trades.
The euro slipped as far as to A$1.4508, within
striking distance of a six-month low of A$1.4508 struck last
In commodities, copper steadied after worries about a
Chinese probe into metals financing pushed prices to one-month
lows in the previous session.
Three-month copper on the London Metal Exchange rose
0.1 percent to $6,680 a tonne from the previous session when it
dropped to $6,636 a tonne, its weakest since early May.
Brent crude gained 12 cents to $110.11 a barrel,
building on the previous session's sharp 1.3 percent rise made
on strong U.S. jobs and improved Chinese export data.
(Additional reporting by the China economics team in Beijing;
Editing by Shri Navaratnam & Kim Coghill)