* MSCI Asia ex-Japan up 0.4 pct, Nikkei erases earlier
* Yen's rebound short-lived as BOJ seen easing again
* Soft Australia retail sales data sends Aussie lower
* Oil eases on caution before China trade data Thursday
* European shares likely rise
By Chikako Mogi
TOKYO, Jan 9 (Reuters) - Asian shares rose on Wednesday as
investors resumed buying after taking profits from a sharp rally
at the start of the year while warily bracing for corporate
earnings season to kick off in full force.
European shares were seen following Asia's lead with a
modest rise, with financial spreadbetters predicting London's
FTSE 100, Paris's CAC-40 and Frankfurt's DAX
would open as much as 0.3 percent higher. U.S. stock
futures suggested a firmer Wall Street start with a 0.1
The yen's rebound as part of broader market position
adjustments was also short-lived, with the dollar erasing
earlier losses to rise 0.5 percent to 87.48 yen on
sustained expectations of further monetary easing in Japan.
MSCI's broadest index of Asia-Pacific shares outside Japan
rose 0.4 percent. Hong Kong shares were
among the top gainers with a 0.5 percent climb, bouncing from
their lowest in a week as Chinese banks were supported by a
brokerage upgrade. Shanghai shares rose 0.3 percent.
"We are running into chart resistance now, so investors are
looking to rotate into laggards. There is no need to be too
bearish right now, at least in the first quarter," said Hong
Hao, Bank of Communication International Securities' chief
Australian shares ended up 0.4 percent to break a
three-day losing streak.
Alcoa Inc, the largest aluminium producer in the
U.S., with customers in a wide range of industries, launched the
U.S. earnings season on Tuesday. It reported a fourth-quarter
profit of $242 million, in line with Wall Street expectations.
U.S. corporate profits are expected to be higher than the
third quarter's lacklustre results, but analysts' estimates are
down sharply from where they were in October.
Credit Suisse said in a research note that Asian equity
market price indices may start to catch up with earnings
estimates which had been outperforming market prices, suggesting
further upside scope for Asian share prices.
The consensus earnings forecast so far is flat in January,
following virtually flat revisions in December, it said.
"It was the persistent EPS downgrades that led to the gap
between equity market price indices and EPS. These flat
revisions could act as a catalyst for equity market price
indices to converge with EPS," Credit Suisse said.
Data flows were light with Australian retail sales
surprisingly fell 0.1 percent in November from October, against
forecasts for a 0.3 percent rise on the month, sending the
Australian dollar down to session lows of $1.0486 from $1.0517
before the data was released.
China will release its December trade data on Thursday,
which includes initial estimates for metals imports and exports.
U.S. crude and Brent both eased 0.1 percent
to $93.03 a barrel and $111.86 respectively.
"What we're seeing in the oil markets is the cautious
sentiment playing up ahead of some key economic events this
week," said Ker Chung Yang, senior investment analyst at
Phillips Futures Pte in Singapore.
YEN STAYS WEAK
Japan's benchmark Nikkei stock average erased
earlier losses to end 0.7 percent higher, bolstered by the yen's
resumed weakness. The dollar had risen about 12 percent over the
past two months against the yen, contributing to the Nikkei's 22
percent jump in the same period.
Expectations of much bolder monetary easing from the Bank of
Japan to help Tokyo beat deflation under new Japanese Prime
Minister Shinzo Abe have encouraged investors to sell the yen.
But as trading resumed from year-end holidays, analysts and
traders said markets were ripe for position adjustments.
"After a good run in risk assets since December, we entered
in a phase of consolidation which is moving from Japanese
equities to short JPY positions," said Sebastien Galy, FX
strategist at Societe Generale in New York, in a note, adding
that the dollar could consolidate to 85 yen but must first take
out the first Fibonacci retracement at 85.75 yen.
Yen crosses which had been bought the most, including the
yen/Korean won, are the most exposed to the correction.
"Such a washout in JPY crosses is the opportunity many
long-term investors will be waiting for to continue their switch
into strategic short yen positions," he said.
The dollar earlier on Wednesday fell as low as 86.825 yen,
having scaled its highest since July 2010 at 88.48 on
Friday. The euro also added 0.2 percent to 114.475 yen
, off the day lows of 113.55. The euro last week hit
115.995 yen, its highest since July 2011.
The Bank of Japan will consider easing monetary policy again
at its Jan. 21-22 meeting, by likely boosting buying of
government bonds and treasury discount bills, while considering
a doubling of its inflation target to 2 percent.
The euro held steady against the dollar at $1.3086,
ahead of Thursday's European Central Bank policy meeting and
Spanish and Italian bond auctions toward the end of the week.
Sentiment turned cautious in Asian credit markets, with the
spread on the iTraxx Asia ex-Japan investment-grade index
widening slightly by 1 basis point.