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Asian stock markets : https://tmsnrt.rs/2zpUAr4

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Nikkei up 2%, reversing early losses

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Nasdaq futures turn positive despite 12% dive in Super

Micro

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Dollar up 1.6% on yen, BOJ says won't hike rates amid

market

uncertainty

(Updates prices, adds comments from BOJ)

By Wayne Cole and Stella Qiu

SYDNEY, Aug 7(Reuters) - Asian share markets extended

gains on Wednesday led by a bounce in the Nikkei, following the

Bank of Japan's unexpected indication of reluctance to further

raise interest rates while markets are volatile, which lead to a

sharp fall in the yen.

The Nikkei's 2% rise followed Tuesday's 10% rally,

leading to optimism investors were finding their footing after

the recent market rout. The index slumped 13% on Monday.

Bank of Japan (BOJ) Deputy Governor Shinichi Uchida said on

Wednesday the central bank won't raise interest rates when

financial markets are unstable.

The dollar jumped 1.6% to 146.65 yen and away

from the 141.675 trough hit on Monday, though it remains far

below its July peak of 161.96.

"The sell-off in Japanese stocks may almost be over,"

said analysts at JPMorgan in a note. "Both nonresident and

individual investors have reset their year-to-date net buying."

"If the market stays at its current level, the GPIF

(government pension fund) could become a net buyer by

end-September, and a view that unwinding of yen carry trades is

almost over has also emerged."

The GPIF is a massive fund with considerable market power

and its investment decisions are highly influential.

The unravelling of the yen carry trade - where investors

borrow yen at low rates to buy higher yielding assets - was a

driving force in the market rout, but again seemed to be

stabilising.

MSCI's broadest index of Asia-Pacific shares outside Japan

jumped 1.3%, while Korean stocks added

2.7%. China's blue chip index rose 0.4% while Hong

Kong's Hang Seng index gained 1.3%.

After Wall Street bounced overnight, Nasdaq futures

rose 0.6% despite a 12% dive in AI darling Super Micro Computer ( SMCI )

after it missed earnings estimates.

S&P 500 futures were also up 0.3% while EUROSTOXX 50

futures firmed 0.8%. FTSE futures added 1%.

With safe-haven in less demand, Treasury yields ticked

higher for a second session. U.S. 10-year yields

were up at 3.9165%, and well off Monday's low of 3.667%.

Two-year yields climbed back to 4.0163%, from a deep

trough of 3.654%, as markets scaled back wagers on an

intra-meeting emergency rate cut from the Federal Reserve.

Futures now imply 105 basis points of easing this year,

compared with 125 basis points at one stage during Monday's

turmoil, while a 50-basis-point cut in September was seen as a

73% chance.

Fears of an imminent U.S. recession had also faded a little

as the run of economic data still pointed to solid economic

growth in the current quarter.

The Atlanta Fed's much-watched GDPNow estimate is that gross

domestic product is running at an annual pace of 2.9%.

In commodity markets, gold prices slipped 0.2% at $2,383.77

an ounce and short of last week's $2,477 top.

Oil prices remained volatile as concerns about waning global

demand warred with the risk of supply disruptions in the Middle

East.

Brent eased 0.3% to $76.23 per barrel, while U.S.

crude fell 0.4% to $72.87 a barrel.