Asian stocks, dollar dip on bailout concerns

By Kevin Yao

SINGAPORE (Reuters) - Asian stocks mostly fell and the U.S. dollar dipped against major currencies on Thursday, pressured by doubts over the U.S. government's proposed $700 billion (377 billion pound) bailout plan and worries about the economic fallout from the crisis.

Gold gained, rising towards Tuesday's seven-week high, and short-term government debt prices climbed on concerns the U.S. bank rescue may be insufficient to deal with the turmoil.

The euro rose 0.6 percent from late U.S. trade to around $1.47 while the dollar index .DXY, which tracks the currency's performance against six major currencies, dropped 0.5 percent. The dollar fell slightly against the yen.

"The bailout offers some respite for the financial sector but does little to change the economic outlook, which continues to deteriorate," said Dwyfor Evans, currency strategist at State Street Global Markets in Hong Kong.

"If the bailout plan disappoints in the coming days it should give a boost to the yen's safe-haven status relative to the dollar," he said in a note.

Warren Buffett's $5 billion bet on Goldman Sachs (GS.N) and the Federal Reserve's new currency swap lines with more central banks helped restore some investor confidence in the dollar, but the buying interest was still limited by worries about the U.S. economy, analysts said.

PRESSURES ON STOCKS

Uncertainty about the $700 billion bailout plan also weighed on U.S. stocks, knocking the Dow Jones industrial average .DJI and the broader-based S&P 500 index .SPX by 0.3 percent and 0.2 percent respectively.