GLOBAL MARKETS-Asian stocks rebound, Fed soothes with boundless QE

* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* S&P 500 futures bounce in Asia, Nikkei jumps
* Investors relieved as Fed pledge eases bond market stress
* Dollar off peaks on promise of bottomless liquidity
* Factory surveys to show extent of economic damage

By Wayne Cole
SYDNEY, March 24 (Reuters) - Asian stocks rallied on Tuesday
as the U.S. Federal Reserve's promise of bottomless dollar
funding eased painful strains in financial markets, even if it
could not soften the immediate economic hit of the coronavirus.
While Wall Street seemed unimpressed, investors in Asia were
encouraged enough to lift E-Mini futures for the S&P 500 ESc1
by 2.7% and Japan's Nikkei .N225 4.7%. If sustained it would
be the biggest daily rise for the Nikkei since late 2016. .T
Europe also looked a shade brighter as EUROSTOXXX 50 futures
STXEc1 climbed 2.6% and FTSE futures FFIc1 rose 2.9%.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS jumped 3.5%, to more than halve Monday's drop.
South Korea's ravaged market climbed 5.2% .KS11 after the
government doubled a planned economic rescue package to 100
trillion won ($80 billion). In its latest mold-breaking step, the Fed offered to buy
unlimited amounts of assets to steady markets and expanded its
mandate to corporate and municipal bonds.
The numbers were certainly large, with analysts estimating
the package could make $4 trillion or more in loans to
non-financial firms.
"What they did, more than just starting up some new
programs, was to drive home they are willing to do whatever it
takes," said Tom Porcelli, chief U.S. economist at RBC Capital
Markets. "We would not call into question their resolve."
"We have every expectation that where a facility/program has
some dollar limitation, that it is just the starting point," he
added. "Upsizing is a foregone conclusion. The spigots are open.
Now let's see how well they work."
The plan helped calm nerves in bond markets where yields on
two-year Treasuries hit their lowest since 2013. Ten-year yields
were at 0.82%, from last week's peak of 1.28% US10YT=RR .
Still, analysts cautioned it would do little to offset the
near-term economic damage done by mass lockdowns and layoffs.
Speculation is mounting data due on Thursday will show U.S.
jobless claims rose an eye-watering 1 million last week, with
forecasts ranging as high as 4 million.
Economists at JPMorgan expect claims to surge by a record
1.5 million and forecast a 14% annualised fall in U.S. gross
domestic product for the second quarter. They see European GDP
down almost 24% and Latin America 12%.
A range of flash surveys on European and U.S. manufacturing
for March are due later on Tuesday and are expected to show deep
declines into recessionary territory.
Surveys from Japan showed its services sector shrank at the
fastest pace on record in March and factory activity at the
quickest in about a decade. DOLLAR OFF HIGHS
While governments around the globe are launching ever-larger
fiscal stimulus packages, the latest U.S. effort remains stalled
in the Senate as Democrats said it contained too little money
for hospitals and not enough limits on funds for big business.
The logjam combined with the stimulus splash from the Fed to
take a little of the shine off the U.S. dollar, though it
remains in demand as a global store of liquidity.
"The special role of the USD in the world's financial system
– it is used globally in a range of transactions such as
commodity pricing, bond issuance and international bank lending
– means USD liquidity is at a premium," said CBA economist
Joseph Capurso.
"While liquidity is an issue, the USD will remain strong."
For now, the prospect of massive U.S. dollar funding from
the Fed saw the currency ease back to 110.22 yen JPY= from
Monday's one-month top of 111.56.
The euro bounced 0.7% to $1.0799 EUR= , up from a
three-year trough of $1.0635. The dollar index slipped 0.4% to
101.720 =USD and off a three-year peak of 102.99.
Commodity and emerging market currencies that suffered most
during the recent asset rout also benefited from the Fed's
steadying hand. The Australian dollar climbed 1.6% to $0.5925
AUD=D3 and away from a 17-year low of $0.5510.
Gold surged in the wake of the Fed's pledge of yet more
cheap money, and was last up 1.5% at $1,576.61 per ounce XAU=
having rallied from a low of $1,484.65 on Monday. GOL/
There were also signs that gold metal itself was in short
supply with the premium on exchange for physical blowing out.
Oil prices also bounced after recent savage losses, with
U.S. crude CLc1 up 82 cents at $24.18 barrel. Brent crude
LCOc1 firmed 64 cents to $27.67. O/R

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Asia stock markets https://tmsnrt.rs/2zpUAr4
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(Editing by Sam Holmes and Lincoln Feast.)