* European shares up 0.6 percent after two days of declines
* Asian shares hit near six-month high as emerging markets
* Dollar steadies; Ukraine unrest keeps uncertainty
(Refiles with correct headline tag)
By Marc Jones
LONDON, April 9 Revived appetite for emerging
markets helped Asian stocks hit a near six-month high on
Wednesday, driving more modest gains in Europe and other
developed markets, where future stimulus looks less clear-cut.
It was an easier start for European bourses after a
difficult couple of days during which tensions have escalated in
Ukraine and the European Central Bank has tempered expectations
of a new asset-buying programme.
The pan-regional FTSEurofirst 300 rose 0.6 percent
as the main markets in London, Paris and
Frankfurt helped claw back some of the 1.2 percent the
FTSEurofirst has lost so far this week.
In the currency market, the euro and sterling
both remained firm as the dollar retook a bit of the
ground it has lost against a rallying yen in recent days.
The International Monetary Fund predicted on Tuesday the
global recovery would strengthen this year and next as output in
richer nations picked up.
But it was emerging markets that got the thumbs-up from
investors again on Wednesday.
MSCI's broadest index of Asia-Pacific shares outside Japan
advanced almost 1 percent to its highest level
since late October, helped by another EM outperformance
, both in stocks and currencies.
Talk that China could be readying new economic support
measures has helped investors largely put aside worries about
geopolitics and slowing U.S. stimulus that fuelled a turbulent
start to the year for emerging assets.
The South Korean won <KRW=KFTC > led Asian currency gains on
Wednesday as it hit a near six-year high thanks to capital
inflows, while the Indonesian rupiah rose as parliamentary
"The divergence (in performance) between developed market
and emerging market assets and currencies has continued,"
analysts at Morgan Stanley wrote in a note to clients.
"A rotation from growth to value assets is being broadly
cited as putting major DM equity markets under pressure."
GREECE IS THE WORD
Core euro zone bonds were under pressure in early European
But periphery debt was back in favour as chatter focused on
talk Greece was poised to announce its return to bond markets,
just two years after a spectacular default that saw investors
lose 70 percent of their cash.
Greece has hired a group of banks to manage the sale of a 2
billion euro five-year bond, Thomson Reuters markets service IFR
reported last week, a move sources said would now happen on
"The fact that Greece is returning is good news for the
periphery in general," one trader said. The yield on Greek
10-year bonds traded at 5.995 pct, its lowest
since prior to its first bailout in 2010.
Nervousness about Ukraine failed to temper the revival of
risk appetite. The United States accused Russian agents and
special forces on Tuesday of fomenting unrest, saying Moscow
could be eyeing military action as it had in Crimea.
The dollar stood at 102.00 yen, off a three-week
trough of 101.55 hit on Tuesday and a long way off the 2-1/2
month high of 104.13 against the Japanese currency it touched on
The British pound's strong run has also been a focus in
currency markets in recent sessions.
It was little changed and buying $1.6744 at 0815 GMT having
jumped on Tuesday after strong industrial output data and
glowing comments from the IMF had stirred expectations for the
Bank of England to raise rates ahead of its peers.
"While the strength of the yen has likely caught many
participants wrong-footed and runs counter to the underlying
theme favouring carry strategies and risk assets, it may be the
pound that is the most surprising," currency strategists at
Brown Brothers Harriman wrote in a note to clients.
In the commodities markets, gold traded near a two-week high
after rising 1 percent on Tuesday thanks to the sharply lower
dollar and the renewed tensions in Ukraine.
Spot bullion traded at $1,310.30 an ounce, not far
off Tuesday's session high of $1,314.43.
The events in eastern Ukraine also provided some support for
oil by fuelling fears that tensions between Moscow and Western
powers may disrupt supply from Russia, one of the world's top
Brent stood little changed at $107.34 a barrel,
holding most of the gains made when it surged 1.7 percent on
(Reporting by Marc Jones; Editing by John Stonestreet)