* MSCI Asia ex-Japan inches to fresh 17-1/2-month high
* BOJ eases further, open-ended commitment to buy assets from 2014
* Yen falls and Nikkei jumps briefly after BOJ, but both reverse course
By Chikako Mogi
TOKYO, Jan 22 (Reuters) - Asian shares rose on Tuesday amid optimism over the global growth outlook, but bold easing measures from the Bank of Japan failed to lift Tokyo equities and the yen rebounded from a brief sell-off as investors digested the central bank's actions.
The MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.4 percent to a fresh 17-1/2-month high, while Australian shares ended little changed after touching a 20-month high earlier in the session. Hong Kong shares hovered around a 19-1/2-month peak and onshore China markets were on track to gain for a fourth-straight day.
The spotlight in Asia fell on the BOJ, which on Tuesday doubled its inflation target to 2 percent and adopted an open-ended commitment to buy assets, surprising markets that had expected another incremental increase in its 101 trillion yen ($1.12 trillion) asset-buying and lending programme.
"A stronger Japan is good for the global economy," said Jeremy Friesen, a commodities strategist at Societe Generale in Hong Kong. He added the stimulus plan will be more positive for base metals than energy as Japan will be building infrastructure that will boost demand for metals such as zinc and copper.
The reaction in Japanese markets, however, reinforced market perceptions that the BOJ could have done more.
The yen rebounded from brief losses and the Nikkei turned down from an initial surge as investors digested the details, including the fact that the new scheme for additional purchases will only come into effect next year. Several analysts were also of the opinion the BOJ could have taken more steps, such as scrapping the 0.1 percent floor for short-term interest rates and extending the duration of bonds the central bank buys.
Japan's benchmark Nikkei average surged as much as 0.8 percent before giving up all gains to end down 0.4 percent. Tokyo shares have been rising in tandem with the yen's slide against major currencies on expectations for bolder BOJ steps. The Nikkei tumbled 1.5 percent on Monday after investors booked profits from the index's 2.9 percent rally on Friday.
The dollar rose as high as 90.18 yen, but was last trading down 0.6 percent at 89.09 yen. It touched a fresh 2-1/2-year high of 90.25 on Monday. The euro rose to 120.18, before falling 0.5 percent to 118.88 yen. The euro hit its peak since May 2011 of 120.73 on Friday.
"The BOJ increase in asset purchases is only commencing in 2014. So no strong immediate increase in easing," said Jeffrey Halley, FX trader for Saxo Capital Markets in Singapore, noting stop-loss selling under 89.50 yen added to the dollar's drop.
Hiroshi Maeba, head of FX trading Japan at UBS in Tokyo, said: "It was more or less within market expectations and was not disappointing. But it also didn't top expectations because there was speculation that the BOJ would do all it can, including removing the 0.1 percent floor on short term interest rates."
Still, there is a perception in markets that even if investors rooting for much bolder BOJ steps cut their yen short positions in disappointment over the outcome, the yen's rebound was likely to be limited relative to its 13 percent decline against the dollar and a 20 percent drop versus the euro over the past two months. Such views were fed by expectations the BOJ will continue to aggressively ease monetary policy to drive Japan out of years of deflation and support the economy.
Brent crude rose 0.3 percent to $112.07 a barrel as the BOJ's latest easing action added to the recent positive data from the United States and China, while growing confidence in the strength of China's economic recovery pushed London copper up 0.7 percent to $8,111.75 a tonne.
European markets are seen subdued, with financial spread-betters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open flat to down as much as 0.1 percent. U.S. stock futures were up 0.2 percent, pointing to a firm Wall Street start.
General market sentiment was also supported by signs of a compromise to avert a U.S. fiscal crisis.
Republican leaders in the U.S. House of Representatives have scheduled a vote on Wednesday on a nearly four-month extension of U.S. borrowing capacity, aimed at avoiding a fight over the looming federal debt ceiling and shifting their negotiating leverage for spending cuts to other fiscal deadlines.
Gold was up 0.2 percent at $1,693.31 an ounce on the fresh round of easing from the BOJ.