Asian Shares Higher; Spot Gold Flirts With $1,000/Oz

SINGAPORE -- Asian markets were slightly higher on Tuesday, helped by gains for European bourses. In Australia, gold miners were lifted as the spot gold price flirted with $1,000 per troy ounce.

"The market lacks strong, fresh upward momentum. Offshore investors' appetite for stocks has waned somewhat, with their interest shifting to safe assets, such as gold and bonds," said Jung Seung-jae at Mirae Asset Securities; but "no big negative factors have emerged. I think global stock markets are now taking a breather after the big rally."

Japan's Nikkei 225 was up just 0.1% and South Korea's Kospi rose 0.4% while Australia's S&P/ASX 200 was 1.1% higher. New Zealand's NZX-50 was up 0.2%. Dow Jones Industrial Average futures were up 45 points in screen trade.

The benchmark December U.S. Comex gold futures touched $1,000 per troy ounce, for the first time since February, though the spot price was still below pivotal psychological level. Spot gold was at $996.20 per ounce, up $3.45 from the London morning fixing.

That was giving Australian gold miners a boost with Newcrest Mining up 2.6% and Lihir Gold up 2.7%.

Trade in the Tokyo market was thin and expected to stay that way for the rest of the week as investors awaited the appointment of new Cabinet members following the Democratic Party of Japan's Lower House election victory in August.

"Investors are reluctant to take large positions before such an important event," said Yukio Takahashi, market analyst at Mizuho Securities.

JVC Kenwood surged 20.4% after the Nikkei reported that the company expected to post group operating profit of up to Y1 billion for the July-September quarter, compared with its forecast for Y500 million.

Solar battery maker Showa Shell was up 2.8% after it said late Monday that it planned to set up its third solar cell factory in Japan as well as incoming Japan prime minister Yukio Hatoyama's comment Monday that Japan would seek to cut global warming gas emissions 25% from 1990 levels, by 2020.

Korean bank and technology stocks were leading the market higher with KB Financial up 1.3% and Shinhan Financial up 0.8%. Samsung SDI was up 3.2% and Samsung Eletro-Mechanics up 2.5% on stronger demand for lithium ion batteries for hybrid vehicles.

Australian resource stocks were higher on European leads with BHP Billiton up 1.3% and Rio Tinto 1.9% higher. Bank shares such as NAB was up 2.1% and QBE rose 2.2%.

In New Zealand, Fletcher Building was up 0.9% while Nuplex rose 2.6% while Freightways was 1.4% higher.

The major currencies were expected to consolidate within recent ranges as players sat on the sidelines, awaiting new cues from economic data, such as China's August consumer price index due later in the week. "The market lacks momentum now with liquidity still low," following U.S. market closure Monday, said Osao Iizuka, head of FX trading at Sumitomo Trust & Banking. The U.S. dollar was at Y93.06 from Y92.97 in late European trade while the euro was at Y133.41 from Y133.54 and at $1.4335 from $1.4339.

Japanese government bond futures were a tad up with the lead September contract up 0.07 point at 138.76 and the 10-year yield flat at 1.355%.

There was little activity in base metals as the U.S. markets were shut for a holiday on Monday. LME three-month copper was now at $6,325 per ton, up $2 from the London kerb, while aluminum was unchanged at $1,865 per ton. LME nickel was at $17,850 per ton, up $155.

Nymex crude oil futures for October were last at $68.00 per barrel, down two cents on Globex.