* Euro off two-week lows vs dollar, capped as rate cut eyed
* MSCI Asia ex-Japan up 1.1 pct, tracking global equity
* Nikkei scales fresh near five-year highs
* European shares likely edge higher
By Chikako Mogi
TOKYO, April 24 (Reuters) - Asian shares advanced on
Wednesday, tracking global equities higher on the back of solid
U.S. earnings, but the euro was pressured by soft German data
tipping a possible rate cut to support the fragile euro zone
European equities will likely remain underpinned by this
expectation of further monetary easing, and European stock
markets are seen rising. Financial spreadbetters predict
London's FTSE 100, Paris's CAC-40 and
Frankfurt's DAX will open up to 0.3 percent higher.
U.S. stock futures were up 0.1 percent to hint at a
steady Wall Street open.
Japanese stocks led the gains in Asian bourses, supported by
bullish U.S. earnings and a pause in the yen's rise, with the
Nikkei stock average hitting its highest since June
"I still think U.S., global money is still underweight
Japan. They haven't corrected that just yet," a senior dealer at
a foreign bank in Tokyo said, adding that he had two buy orders
for every sell order.
The tone in global equities markets was generally positive
despite several sluggish manufacturing surveys around the world,
reflecting investor views that weak economic data justifies
central banks maintaining monetary stimulus -- encouraging
investment in shares.
MSCI's broadest index of Asia-Pacific shares outside Japan
climbed 1.1 percent, led by a 1.5 percent gain
in Australian shares as benign inflation data
strengthened the case for more local interest rate cuts.
Australia's first-quarter core consumer price index (CPI)
rose 0.3 percent on-quarter, below a 0.5 percent rise forecast
in a Reuters poll, narrowing the odds of interest rate cuts from
the Reserve Bank of Australia (RBA).
"With such a reading coming out there's definitely talk of
room for further rate cuts. Whether or not the RBA will pull the
trigger, it certainly seems that inflation is well under
control," said Stan Shamu, market strategist at IG Markets.
After the bell on Wall Street, Apple shares rose,
with the company reporting better-than-expected second-quarter
revenue of $43.6 billion.
According to Westpac bank, 72.8 percent of the 147 Standard
& Poor's 500 companies reporting so far have beaten consensus
Asian bourses also turned their attention to local earnings.
Seoul shares were up 0.8 percent after rising to a
one-week high on Wednesday after chipmaker SK Hynix reported
quarterly operating profits that handily beat forecasts, but the
upside was curbed ahead of more earnings being published.
GROWTH WORRY CAPS EURO
The euro was around $1.2995, managing to recover from
Tuesday's two-week low of $1.2973 hit after a survey showed
Germany, the euro zone's largest economy, saw business activity
decline in April for the first time in five months. Traders saw
it as strengthening the case for the European Central Bank to
cut interest rates.
The upside for the euro was limited, given the potential for
an ECB rate cut and lingering concerns about the growth outlook
in the recession-hit euro-zone.
The dollar was down 0.1 percent at 99.35 yen,
struggling to break above the key 100-yen mark due to weak U.S.
economic reports, but traders say the upcoming Bank of Japan
meeting on Friday may provide an opportunity to clear that
Commodities were also capped by concerns about slowing
demand. Investors will be eyeing U.S. durable goods orders data
and the German IFO index due later in the session for further
clues on the state of the global economy.
Brent crude rose 0.3 percent to $100.64 a barrel,
holding above $100 by fears that OPEC could cut oil supply if
prices fall more, although data from major economies pointing to
slower growth and fuel demand capped gains. U.S. crude
rose 0.5 percent to $89.66.
London copper climbed 1.5 percent to $6,970 a tonne
as brighter corporate earnings sparked a rush of short-covering,
but prices held close to one-and-a-half year lows after a string
of weak manufacturing data hurt the demand outlook.
"PMI data yesterday wasn't as good as people expected and so
metals have taken some pressure from that," said Bonnie Liu, an
analyst with Macquarie in Shanghai.
Earlier in the Asian session on Wednesday, New Zealand's
central bank held its benchmark interest rate at a record low
2.5 percent for the 17th straight review, reaffirming it expects
to be on hold for the rest of the year as the economy picks up
and inflation remains tame.