GLOBAL MARKETS-Asian shares, commodities rise as Dow record bolsters
* MSCI Asia ex-Japan up 0.9 percent
* Nikkei hits fresh 4-1/2-year highs
* Aussie dollar, copper and oil gain
TOKYO, March 6 (Reuters) - Asian shares extended gains on Wednesday as Wall Street's record close encouraged investors to take on more risk amid signs of a continuing U.S. economic recovery and globally accommodative monetary conditions.
The dollar eased 0.2 percent against a basket of key currencies while copper and crude oil prices rose as did commodity-linked currencies, often linked to risk appetite. The Australian dollar rose 0.2 percent to $1.0291, above an eight-month low of $1.0116 plumbed on Monday.
The MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.9 percent, adding to Tuesday's 1.3 percent surge. The index tumbled to a nine-week low on Monday.
Asian shares took their cue from overnight gains in global equities, with the Dow Jones industrial average ending at an all-time high and the pan-European FTSEurofirst 300 index closing at its highest in 4-1/2 years.
The huge U.S. services sector growing in February at its fastest pace in a year bolstered investor sentiment while China's announcement of record government spending in 2013 boosted hopes of economic growth and demand for goods.
"The Chinese announcement at the start of its annual parliament meetings stamped out any extremely bearish bias as the message was that China will support growth but will not tolerate upside risks such as the housing sector," said Naohiro Niimura, a partner at research and consulting firm Market Risk Advisory in Tokyo.
"It also removed one of the political uncertainties which investors worried would dampen growth momentum, spurring short covering, particularly in base metals," he said.
London copper inched up 0.2 percent to $7,784.75 a tonne and crude futures also rose.
U.S. crude rose 0.3 percent to $91.08 a barrel and Brent crude rose 0.4 percent to $112.01. Brent's front-month contract for April delivery rose as high as $111.93 a barrel in post-settlement activity on Tuesday, following news of Venezuelan President Hugo Chavez's death on Tuesday after a two-year battle with cancer.
Niimura said the exit of Chavez from Venezuela's political scene would normally put downward pressures on oil prices, as the risk of manipulation such as controlling prices or supplies under Chavez's dictatorship dissipate with his passing.
Australian stocks jumped 1.1 percent to fresh 4-1/2-year highs, led by banks and miners as upbeat domestic data and signs of steady growth in China buoyed investor confidence.
Australia's economy grew 0.6 percent last quarter as a surge in resource exports helped offset a drag from inventories and sluggish consumer spending. Gross domestic product rose 3.1 percent compared to the fourth quarter of 2011, just above expectations and well ahead of most developed countries.
Japan's Nikkei stock average rose 1.3 percent to a fresh 4-1/2-year peak.
BUBBLY OR NOT
Despite the increasingly positive mood, there are still some areas of concern, namely the Chinese government's move to dampen the country's overheated property market, a possible economic impact from the U.S. "sequestration" spending cuts, and last month's election deadlock in Italy.
But these worries have been eclipsed by a belief that major central banks stand ready to provide funding and monetary policy support to sustain the fragile recovery trend worldwide.
"That's fantastic testament to the power of easy money, in the face of doubts about the U.S. economy now that fiscal spending is being cut back," said Kit Juckes, strategist at Societe Generale. "Not to mention the power of easy money to overcome political uncertainty in Italy and recession throughout Europe."
The Bank of Japan, the Bank of England and the European Central Bank all hold their policy meetings on Thursday.
The euro held steady around $1.3058. The dollar was down 0.2 percent against the yen at 93.08 yen.
Barclays Capital said in a note that despite the Dow's stellar performance overnight, implied volatility, the credit markets, and earnings imbalances are not yet flashing warning signs unlike in 2007 prior to the financial crisis.
"Still, while Fed policy can move stock prices, it cannot overcome fundamentals by itself and valuation metrics are not a compelling reason to be long stocks at current levels. We will be watching other asset classes closely for signs the 'reach for yield' is creating macroeconomic risks but believe we are some way from that point," it said.