Asia rises on merger buzz north

GLOBAL MARKETS/ STOCK REPORT

Asian stocks rose, lifting the region's benchmark to a three-week high, after Aluminum Corp of China's purchase of a stake in Rio Tinto Group fueled speculation of more takeovers.

Fortescue Metals Group jumped after the South China Morning Post reported China may buy a stake. Alibaba.com climbed after Microsoft offered to purchase Yahoo!, an Alibaba shareholder.

China's benchmark CSI 300 Index, down 14 per cent this year, surged 8.3 per cent on a report that the government lifted a ban on new mutual funds.

The MSCI Asia Pacific index climbed 2 per cent to 148.05 at 7:27 pm in Tokyo, set for the highest close since January 15.

The measure in January had its worst month since 2001 amid concern credit-market losses and a US slowdown will weigh on Asia's expansion. The index has rebounded 12 per cent from a 14-month low set on January 22.

Japan's Nikkei 225 Stock Average added 2.7 per cent to 13,859.70. The CSI 300's gain on Monday was the steepest since the measure was first introduced in 2005. Other Asian markets rose as well. EUROPE
European stock-index futures rose, following advances in US and Asian equities. BHP Billiton and Anglo American may climb as zinc and copper gained.

Futures on the Dow Jones Euro Stoxx 50 Index, a benchmark for the euro region, added 41 points, or 1.1 per cent, to 3,925 at 7:37 am in London. The UK's FTSE 100 Index may rise 27, according to CMC Markets, a betting firm in London.

"Expectations are for the main European indices to keep pushing higher," said Matt Buckland, a trader at CMC Markets in London. "Wall Street ended the week in positive territory, and this is already driving gains across Asia." US
US stock-index futures declined after UBS said a consumer-led recession would drag down American Express and Merrill Lynch recommended selling shares of Wells Fargo and Wachovia Corp.

American Express, the third-largest US credit-card network, fell in Europe after UBS downgraded the company to "sell" on speculation an economic contraction will spur credit losses. Wells Fargo retreated after Merrill said the bank's share price did not reflect the risk of a recession.

Standard and Poor's 500 Index futures expiring in March lost 3.1 points to 1,394 at 10:51 am in London. Dow Jones Industrial Average futures fell 28 points to 12,728. Nasdaq-100 Index futures dropped 1.25 points to 1,862.25.