Asian markets creep higher after US ends flat

HONG KONG - Asian stocks posted cautious gains Thursday, with Tokyo's index up 1 percent, as President Barack Obama's $75 billion lifeline to homeowners did little to allay concerns about the global economy.

Investors nibbled at beaten down shares but enthusiasm was tempered by another dose of negative economic data in the U.S. and Asia, as well as Wall Street's sideways session. Oil prices languished below $35 a barrel, while the dollar was little changed against the yen after advancing strongly overnight.

Many were awaiting the outcome of the Bank of Japan's two-day policy meeting. The world's second-largest economy is struggling with its biggest contraction in more than three decades but with interest rates already near zero, the central bank is low on ammunition to fight the crisis. In Taiwan, bleak economic data confirmed the country had slipped into recession.

In New York overnight, U.S. markets ended a volatile session mostly flat after Obama unveiled his relief plan.

The program would provide incentives to mortgage lenders to help borrowers reduce their payments to help counter a souring housing market at the core of the economic crisis.

While a number of analysts said the program would help limit the hemorrhaging in housing prices, the market's cool reception seemed to show how much investors have lost confidence in government bailouts.

"We are still dealing with a lot of bad news. We all should be concerned what is going to happen in the economy," said Winson Fong, Hong Kong-based managing director at SG Asset Management, which oversees about $2 billion in equities in Asia. "Things are still getting worse this year, so we're seeing a lot of markets drifting down slowly."

Tokyo's Nikkei 225 stock average gained 71.84 points, or 1 percent, to 7,606.28, helped by a weaker yen that improves repatriated profits of the country's many exporters.

In Hong Kong, the Hang Seng fell 0.4 percent to 12,966.33, while South Korea's Kospi gained 0.4 percent to 1,117.53.

Elsewhere, Shanghai's benchmark was 0.7 percent higher, Australia's key index gained 1.3 percent and Taiwan's stock measure rose 2.2 percent.

In New York, the Dow Jones industrial average edged up 3.03, or less than 0.1 percent, to 7,555.63. For a second day, the blue chips managed to finish just above their November closing low.

Broader stock indicators slipped. The Standard & Poor's 500 index fell 0.75, or 0.1 percent, to 788.42, and the Nasdaq composite index fell 2.69, or 0.2 percent, to 1,467.97.

In oil, light, sweet crude for March delivery was off 1 cent at $34.61 a barrel in Asian trade.

Overnight, the contract lost 31 cents to settle at $34.62 a barrel on the New York Mercantile Exchange. The March contract expires on Friday, and most of the trading was for the April contract.

In currencies, the dollar continued to gain against the yen, rising to 93.71 yen compared to 93.65 yen earlier. The euro rose to $1.2584 from $1.2560.