By V. Phani Kumar, Shri Navaratnam & Leslie Shaffer
HONG KONG (MarketWatch) -- Asian markets rebounded Monday after Dubai received $10 billion in financing from Abu Dhabi, lifting sentiment and spurring buying in resource shares.
Japan's Nikkei 225 Average, which fell as much as 1% during the session, finished the day flat at 10,105.68. Hong Kong's Hang Seng Index, which fell more than 1.6% earlier, recovered to end the morning session 0.1% higher. Australia's S&P/ASX 200 gained 0.4%, New Zealand's NZX 50 fell 0.9%, South Korea's Kospi rose 0.4% and Taipei's Taiex advanced 0.3%.
Elsewhere, Singapore's Straits Times Index was flat, and India's Sensex rose 0.8%.
"The Australian market had a 30-point rebound based upon the move by Abu Dhabi to provide funding," said Jamie Spiteri, head of trading at Shaw Stockbroking in Sydney. "The U.S. futures are pointed strongly up on the back of that. ... It's certainly had a short-term reaction here. [But] it's not a dramatic reaction."
Earlier Monday, Dubai said it has received $10 billion in financing from Abu Dhabi, which will pay a part of the debt held by conglomerate Dubai World and its property unit Nakheel.
Dow Jones Industrial Average (INDU 10,472, +65.67, +0.63%) futures were up 63 points at 10,486 by the Asian afternoon, after hitting a low of 10,397 earlier in the day.
Commodity-linked shares helped the rebound. BHP Billiton (BHP 73.75, +0.66, +0.90%) (AU:BHP 40.61, +0.15, +0.37%) rose 0.4%, and Rio Tinto (AU:RIO 70.51, +0.33, +0.47%) (RTP 203.82, +1.32, +0.65%) gained 0.5% in Sydney, with both stocks bouncing off early declines. Inpex Corp. (JP:1605 655,000, +15,000, +2.34%) (IPXHF 8,561, +961.05, +12.65%) gained 0.6%, and commodities trader Marubeni Corp. (MARU.Y 53.35, -0.88, -1.62%) (JP:8002 480.00, +11.00, +2.35%) added 1.5% in Tokyo. Korea Zinc Co. added 2.9% in Seoul, and Sterlite Industries Ltd. (SLT 17.82, -0.18, -1.00%) advanced 0.6% in Mumbai.
Most of the markets had dropped earlier in the day, with analysts also looking for cues from a host of central-bank policy meetings this week, led by the Federal Reserve, the Bank of Japan and others in Sweden and the Philippines, said Greg Gibbs, currency strategist at RBS in Sydney.
In Tokyo, the Bank of Japan's tankan survey had failed to inspire as it provided mixed signals with the better-than-expected headline diffusion index and weak capital expenditure gauge offsetting each other, said Daiwa Securities SMBC market analyst Yumi Nishimura. See full story on Japan's tankan survey results.
In foreign exchange markets, the euro extended gains against the U.S. dollar on news from Dubai. The currency was at $1.4679 from versus $1.4621 in New York late Friday, and at 130.29 yen from 130.43 yen earlier. The dollar was buying 88.74 yen, down from 89.22 yen.
