SINGAPORE, Jan 16 Hopes for strong earnings growth lifted microchip-related stocks in Tok

SINGAPORE, Jan 16 (Reuters) Hopes for strong earnings growth lifted microchip-related stocks in Tokyo on Tuesday, and copper dropped by its daily limit in Shanghai on ample supplies.

Although Australian and Indian shares edged to fresh record highs, Asian markets were mostly flat, near landmark peaks after hefty gains in recent days.

London financial bookmakers saw UK stocks <.ftse> opening between 8 and 10 points lower.

The prospect of a Bank of Japan rate rise at this week's policy meeting failed to prevent the yen from weakening and weighed on Japanese government bonds.

Gold futures reached a six-month high on technical buying, and crude oil dropped below $53 a barrel to near last week's 19-month low on mild U.S. winter weather.

Tokyo's benchmark Nikkei average <.n225> finished flat, about 1 percent short of the 6-1/2-year peak it reached on Jan. 4.

Microchip-related stocks such as Advantest Corp. , up 1.8 percent, were among Tokyo gainers.

''Makers of chip-building equipment are gaining because their earnings have been strong,'' said Katsuhiko Kodama, senior strategist at Toyo Securities.

''I think tech stocks are likely to be the focus among blue chips this year.... While their stock prices are relatively high at the moment, I still think they have room to advance.'' Sales of Japanese equipment used to make microchips are likely to post their second straight year of double-digit growth in the year starting in April, bolstered by computer memory demand, an industry group said on Monday. [ID:nT295730] Hong Kong's Hang Seng <.hsi> fell 0.1 percent and MSCI's index of non-Japan Asian shares <.msciapj> was higher by the same amount at 0630 GMT. Australian shares <.axjo> were flat after reaching a record. India's main index <.bsesn> edged up to a record too, helped partly by strong results.

U.S. stocks closed higher. The Dow Jones industrial average <.dji> rose 0.3 percent and the Nasdaq Composite Index <.ixic> put on 0.7 percent.

COPPER BOTTOM Copper futures fell by their 4 percent daily limit in Shanghai on rising stocks. Stockpiles in London Metal Exchange warehouses stand at nearly twice their level of early 2006. Traders in Shanghai said copper supply in eastern China was also abundant.

The yen was little changed, near a 13-month trough against the dollar, failing to find support from rate-rise expectations.

Of 35 traders and analysts in Tokyo's foreign exchange and bond markets that took part in a Reuters survey on Monday, 29 said they expected the Bank of Japan to raise rates this week.

A hike of 25 basis points to 0.50 percent at a two-day policy meeting that ends on Thursday is expected, but a rise will not provide much yen support since the BOJ is likely to take its time before conducting any subsequent increases, they say.

The dollar stood at 120.35 yen , against around 120.45 yen in late London trading on Monday, and near a 13-month high of 120.74 yen struck on Friday. The euro stood at $1.2952 against the dollar.

Japanese government bond (JGBs) futures hovered near a 2-1/2-month low touched on Monday after strong data bolstered rate-increase expectations.

March futures were up 0.11 point at 133.76, not far from a 2-1/2-month low of 133.40 hit on Monday.

Tokyo gold futures jumped to their highest in almost six months on technical buying. NYMEX crude fell 56 cents to $52.43 a barrel, near a 19-month low below $52 reached last week, as mild winter weather in the United States outweighed fears producer cartel OPEC may put a squeeze on supply .

REUTERS PV GC1309