Nikkei nears 6-yr high; dollar slips

SINGAPORE, Feb 13 (Reuters) The Nikkei share index neared its highest levels in more than six years on Tuesday, led by companies with strong earnings such as Japanese property firms, while the dollar slipped against the yen.

Oil held below after sliding almost 3.5 percent overnight and gold retreated on a stronger U.S. currency.

The dollar eased against the yen on profit-taking after touching near four-year highs the previous day on the G7 industrial powers' failure to raise a formal warning about the weakness of the Japanese currency.

Japan's Nikkei gained 0.63 percent in morning trade, driven by real estate firms that reported strong earnings results last week, such as top property firm Mitsui Fudosan Co. Ltd. which jumped 5.3 percent.

Bank shares such as Mitsubishi UFJ Financial Group Inc. and others dependent on domestic demand also rose, as the market expects a solid reading for GDP data on Thursday, said Zenshiro Mizuno, senior managing director at Marusan Securities.

''Bank shares have been adjusting positions and are now gaining strength. The overall market will likely continue to be bullish,'' Mizuno said.

Australian shares rose 0.4 percent to a fresh record high before easing later in the session. Gains were led by Alumina Ltd. and top banks such as National Australia Bank Ltd. ahead of its first-half earnings on Wednesday.

Alumina leapt as high as 8.3 percent to a level not seen since May 2006 on reports that mining giants BHP Billiton Ltd and Rio Tinto have drafted separate plans for a billion takeover of U.S. aluminium producer Alcoa Inc A possible takeover of Alcoa, which has a joint-venture firm with Alumina, spurred talk that Alumina might also be a takeover target.

But other regional stock markets were steady to lower after U.S stocks declined, with the Dow Jones average down 0.22 percent and the tech-heavy Nasdaq 0.38 percent lower.

MSCI's measure of Asia-Pacific stocks excluding Japan dropped 0.5 percent.

Seoul stocks slipped 0.1 percent. But firms involved in inter-Korean tourism projects such as Hyundai Merchant Marine Co. enjoyed a boost as investors anticipated a potential deal on North Korea's nuclear programme.

Hong Kong fell 1.8 percent, led by mainland banks on talk that China's central bank could raise interest rates after the Lunar New Year holiday, which begins this weekend.

Hutch Telecommunications International Ltd. plummetted nearly 13 percent in resumed trade as investors sold off following the sale of a controlling stake in Indian mobile phone firm Hutchison Essar, a growth driver for Hutch Telecoms.

Taiwan stocks lost 0.6 percent and Singapore edged down 0.3 percent.

DOLLAR DIPS The dollar shed 0.4 percent from late New York trade to 121.45 yen after climbing as high as 122.05 yen in the previous session, near the four-year peak of 122.20 yen touched in January.

The euro also edged down to 157.44 yen after Monday's all-time high of 159.00, on a lack of stronger vocal support from the Group of Seven, which suggested that the group would leave it to the markets to correct the weak yen.

Japan's top government spokesman said on Tuesday the country's foreign exchange policy was unchanged after the G7 meeting late last week.

''I take it that the communique expresses the same policy as before, that foreign exchange should reflect economic fundamentals and that excessive fluctuations are undesirable,'' said Chief Cabinet Secretary Yasuhisa Shiozaki.

The rise in Tokyo stocks pressured Japanese government bond (JGB) futures, with the March futures tumbling 0.57 point. JGBs were also dragged lower ahead of economic growth figures due later in the week.

Japanese wholesale prices rose less than expected in January from a year earlier, signalling that price growth remains tame, and investors await GDP data to see if the Bank of Japan is likely to raise interest rates next week.

Investors are also awaiting this week's congressional testimony on the U.S. economic outlook from Federal Reserve chief Ben Bernanke starting on Wednesday for clues on the monetary policy outlook.

U.S. crude clawed back up to .94 after sliding more than SINGAPORE, Feb 13 (Reuters) The Nikkei share index neared its highest levels in more than six years on Tuesday, led by companies with strong earnings such as Japanese property firms, while the dollar slipped against the yen.

Oil held below $58 after sliding almost 3.5 percent overnight and gold retreated on a stronger U.S. currency.

The dollar eased against the yen on profit-taking after touching near four-year highs the previous day on the G7 industrial powers' failure to raise a formal warning about the weakness of the Japanese currency.

Japan's Nikkei gained 0.63 percent in morning trade, driven by real estate firms that reported strong earnings results last week, such as top property firm Mitsui Fudosan Co. Ltd. which jumped 5.3 percent.

Bank shares such as Mitsubishi UFJ Financial Group Inc. and others dependent on domestic demand also rose, as the market expects a solid reading for GDP data on Thursday, said Zenshiro Mizuno, senior managing director at Marusan Securities.

''Bank shares have been adjusting positions and are now gaining strength. The overall market will likely continue to be bullish,'' Mizuno said.

Australian shares rose 0.4 percent to a fresh record high before easing later in the session. Gains were led by Alumina Ltd. and top banks such as National Australia Bank Ltd. ahead of its first-half earnings on Wednesday.

Alumina leapt as high as 8.3 percent to a level not seen since May 2006 on reports that mining giants BHP Billiton Ltd and Rio Tinto have drafted separate plans for a $40 billion takeover of U.S. aluminium producer Alcoa Inc A possible takeover of Alcoa, which has a joint-venture firm with Alumina, spurred talk that Alumina might also be a takeover target.

But other regional stock markets were steady to lower after U.S stocks declined, with the Dow Jones average down 0.22 percent and the tech-heavy Nasdaq 0.38 percent lower.

MSCI's measure of Asia-Pacific stocks excluding Japan dropped 0.5 percent.

Seoul stocks slipped 0.1 percent. But firms involved in inter-Korean tourism projects such as Hyundai Merchant Marine Co. enjoyed a boost as investors anticipated a potential deal on North Korea's nuclear programme.

Hong Kong fell 1.8 percent, led by mainland banks on talk that China's central bank could raise interest rates after the Lunar New Year holiday, which begins this weekend.

Hutch Telecommunications International Ltd. plummetted nearly 13 percent in resumed trade as investors sold off following the sale of a controlling stake in Indian mobile phone firm Hutchison Essar, a growth driver for Hutch Telecoms.

Taiwan stocks lost 0.6 percent and Singapore edged down 0.3 percent.

DOLLAR DIPS The dollar shed 0.4 percent from late New York trade to 121.45 yen after climbing as high as 122.05 yen in the previous session, near the four-year peak of 122.20 yen touched in January.

The euro also edged down to 157.44 yen after Monday's all-time high of 159.00, on a lack of stronger vocal support from the Group of Seven, which suggested that the group would leave it to the markets to correct the weak yen.

Japan's top government spokesman said on Tuesday the country's foreign exchange policy was unchanged after the G7 meeting late last week.

''I take it that the communique expresses the same policy as before, that foreign exchange should reflect economic fundamentals and that excessive fluctuations are undesirable,'' said Chief Cabinet Secretary Yasuhisa Shiozaki.

The rise in Tokyo stocks pressured Japanese government bond (JGB) futures, with the March futures tumbling 0.57 point. JGBs were also dragged lower ahead of economic growth figures due later in the week.

Japanese wholesale prices rose less than expected in January from a year earlier, signalling that price growth remains tame, and investors await GDP data to see if the Bank of Japan is likely to raise interest rates next week.

Investors are also awaiting this week's congressional testimony on the U.S. economic outlook from Federal Reserve chief Ben Bernanke starting on Wednesday for clues on the monetary policy outlook.

U.S. crude clawed back up to $57.94 after sliding more than $2 on Monday after OPEC members, led by Saudi Arabia, signalled the cartel would probably keep output steady when it meets next month.

Spot gold was last quoted around $661.20 an ounce, down from $661.40 in New York trading. But the Asian marker Tokyo gold futures rose above 2,600 yen per gram, the highest for any benchmark contract since September 1985.

REUTERS PV DS1302 on Monday after OPEC members, led by Saudi Arabia, signalled the cartel would probably keep output steady when it meets next month.

Spot gold was last quoted around 1.20 an ounce, down from 1.40 in New York trading. But the Asian marker Tokyo gold futures rose above 2,600 yen per gram, the highest for any benchmark contract since September 1985.

REUTERS PV DS1302