GLOBAL MARKETS-Asia shares nudge up on Obama 'fiscal cliff' comments
* MSCI Asia ex-Japan hits 16-month peak, trade cautious
* Nikkei rises to seven-month high, HK at 16-month peak
* Euro struggles while dollar steadies vs yen
* Markets waiting for ECB rate comments later in day
TOKYO, Dec 6 (Reuters) - Asian shares rose to a 16-month high on Thursday after U.S. President Barack Obama said a deal to avert the so-called fiscal cliff of year-end tax hikes and spending cuts was possible in "about a week" if Republicans compromise on taxes.
The $600 billion combination could push the U.S. economy into recession unless Congress acts, but markets have kept up hopes for a compromise given the consequences of no action.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.2 percent to reach a 16-month high and Japan's Nikkei stock average climbed 0.8 percent to a seven-month high, as exporters drew support from a weaker yen.
The Korea Composite Stock Price Index (KOSPI) rose 0.4 percent to a seven-week high, although the lack of a U.S. fiscal deal was capping the upside potential of the market.
"The market is struggling to rise sharply, weighed down by concerns about an uphill political battle to reach a U.S. fiscal deal," said Lee Kyeong-soo, an analyst at Shinyoung Securities.
Hong Kong shares hit a 16-month peak while the Shanghai Composite Index fell 0.2 percent, retreating after a move on Wednesday above the 2,000-point mark for the first time since late November.
Year-end positioning was driving flows while investors waited for the European Central Bank's policy decision later in the day and U.S. jobs data on Friday for clues on the state of the U.S. economy after recent mixed reports.
"Today, sentiment is likely to be neutral in Asia, amid lack of major data and as investors look towards tomorrow's labour market report in the U.S.," said Credit Agricole CIB analysts in a research report.
Market attention on U.S. fiscal woes probably reflected more investor lethargy than any real U.S. concern, they said.
"Once markets fully embrace a 'two-step' U.S. fiscal solution between Democrats and Republicans (i.e. with any grand bargain coming in Q1 2013), a comparison of expected 2013/14 growth profiles clearly favours renewed (U.S. dollar) strength," they said.
The dollar edged up 0.1 percent against a basket of major currencies. It traded at 82.49 yen, not far from a 7-1/2-month high of 82.84 hit on Nov. 22, on expectations Japan's Dec. 16 election will usher in a government that will apply more pressure on the central bank to revive the shrinking economy.
The euro eased 0.1 percent to $1.3057, off a seven-week high of $1.3127 touched on Wednesday before a disappointing Spanish bond auction reminded investors of the country's fragile fiscal health, prompting a selloff in the single currency.
Weak euro zone economic data also dampened sentiment for the euro, with a mixed batch of business and retail data showing shoppers cut back on spending in October by the biggest margin in six months, while purchasing manager figures pointed to another quarter of recession.
The European Central Bank is expected to keep its benchmark interest rate on hold at 0.75 percent, and investors will be looking for clues on whether ECB President Mario Draghi will show a greater willingness to cut borrowing costs in the future as the euro zone recession deepens.
Ahead of key U.S. monthly nonfarm payrolls due on Friday, private payrolls processor ADP reported that private-sector employers added 118,000 jobs in November, fewer than expected as Superstorm Sandy took a toll on hiring, although activity in the service sector continued to expand.
Data from Asia on Thursday illustrated a patchy economic picture.
Australian employment topped expectations for a second month in November and the jobless rate unexpectedly fell to a three-month low of 5.2 percent, lifting the local currency by a third of a U.S. cent to $1.0471.
The report could lessen the urgency for the Reserve Bank of Australia to follow up with more interest rate cuts to support growth, after it earlier this week eased rates to match the record low 3 percent touched during the global financial crisis.
Growth this year in Asia's fourth-largest economy, South Korea, will likely fall below the Bank of Korea's 2.4 percent target, the central bank said Thursday.
U.S. crude futures were little changed at $87.85 a barrel and Brent also steadied around $108.84.
Spot gold was nearly flat at $1,693.80 an ounce. Gold fell to a one-month low below $1,700 on Wednesday, after a weaker price forecast by Goldman Sachs triggered some fund liquidation.