By Chikako Mogi

TOKYO, Jan 25 (Reuters) - Asian shares fell on Friday, hurt

by a drop in regional technology stocks, although gains in

Australia and Japan contained overall losses for equities.

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

Japan slipped 0.7 percent, led by a 1.7 percent

slide in the technology sector. A sharp fall in

tech-heavy markets such as South Korea and Taiwan contributed to

the regional retreat.

Seoul shares tumbled 1.3 percent, weighed by weak

profits for automakers, while tech shares continued to falter as

Samsung Electronics announced cautious spending

plans for the first time since the global financial crisis,

following rival Apple Inc's below-estimate results

announced earlier in the week.

Apple suppliers extended their declines from Thursday,

including Taiwan's Largan Precision, while Samsung

shares fell 2.8 percent.

A rise in copper and steady gold prices helped push

commodity-reliant Australian shares up 0.4 percent to a

fresh 21-month high, marking an eighth straight session of

gains.

'The U.S. debt ceiling has been pushed out, Japan is

stimulating their economy and Europe seems to have digested

their debt crisis. There aren't a lot of negatives at the

moment,' said Lonsec senior client adviser Michael Heffernan in

Melbourne.

Japan's Nikkei stock average also outperformed its

Asian peers with a 2 percent surge as the yen hit fresh lows

versus the dollar and the euro on expectations Japan will pursue

bold policies to beat deflation and stimulate growth.

'Trading on Japan is gaining momentum among foreign

investors, centering around the dollar/yen, which has dictated

Nikkei's direction,' said Tetsuro Ii, the chief executive of

Commons Asset Management.

The yen's slide after its brief rebound this week bolstered

sentiment for Japanese equities as it lifts earnings prospects

for exporters, ahead of the quarterly earnings season set to

start next week.

The dollar scaled its highest level since June 2010

to reach 90.695 yen early on Friday and the euro rose

to 121.32, its highest since April 2011. Prime Minister Shinzo

Abe's new administration has made clear it wants a weaker yen,

providing investors a reason to short the currency.

The yen has declined sharply since mid-November on

expectations the new government will implement aggressive

monetary easing and huge fiscal spending polices to end decades

of deflation and return Japan to a sustainable growth path.

More than 80 percent of Japanese firms are in favour of

Abe's policy mix, though most also feared Japan would face a

debt crisis within a few years, according to a Reuters poll.

'JPY weakness should continue over the coming year driven by

an expansion of the Bank of Japan's balance sheet relative to

the European Central Bank and the Federal Reserve,' said Kit

Juckes, FX strategist at Societe Generale in a note. 'I don't

know how long the USD/JPY is going to pause at around 90, but a

move to 100 still seems very likely in the longer run.'

Solid data from the United States and Germany after

similarly upbeat manufacturing figures from China lifted world

equity and commodity markets.

The Standard & Poor's 500 Index briefly topped the

symbolic 500 mark for the first time since December 2007 while

European shares hit their 2013 peak.

U.S. factory activity grew the most in nearly two years in

January while a German business survey showed its private sector

expanding at its fastest pace in a year this month.

U.S. crude eased 0.2 percent to $95.78 a barrel and

Brent inched down 0.2 percent to $113.11.

London copper rose 0.2 percent to $8,109 a tonne and

spot gold steadied around $1,667.64 an ounce.

(Editing by Shri Navaratnam)

((chikako.mogi@thomsonreuters.com)(+813-6441-1871)(Reuters

Messaging: chikako.mogi.thomsonreuters.com@reuters.net))

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