YEREVAN, June 27. /ARKA/. Asian shares extended gains for a second day on Thursday, buoyed by a rise in global equities on expectations that the U.S. Federal Reserve will not rush to end its stimulus program, and by further signs of improvement in China's strained money markets.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 1.8 percent, after climbing 1.9 percent on Wednesday to break a four-day losing streak and moving away from an 11-month low touched earlier in the week.

Its relative strength index (RSI) improved but remained weak, with investors still nervous after a month-long emerging markets slide.

The market tone improved overnight after a surprisingly sharp downward revision to first-quarter U.S. economic growth eased fears that the Fed would soon wind down the bond-buying scheme that has underpinned investor risk appetite.

Steadying Chinese markets also helped calm emerging market currencies and stocks.

Chinese money market rates moderated for a fifth day on Thursday after last week's spike and stocks recovered some of their recent hefty losses as fears of a credit crunch eased.

Hong Kong shares .HSI rose 1.5 percent and Shanghai shares .SSEC added as much as 1.2 percent before paring gains.

Japan's Nikkei stock average, which was pulled down on Wednesday by losses in Chinese shares, rose 2 percent. .T

Australian shares jumped 1.3 percent .AXJO following Wall Street's overnight rally even as investors looked for direction on economic policy after a surprise change of prime minister.

Seoul shares extended gains and soared 2.8 percent .KS11 as foreign investors turned net buyers, poised to snap 14 straight sessions of selling, after prices hit an 11-month low.

"The market is seeing a technical rebound on bargain hunting, but (upward moves) are probably not being established as a trend ... the stance on emerging markets is still cautious," said Lim Soo-gyoun, a market analyst at Samsung Securities, of Seoul shares. –0--