GLOBAL MARKETS-Stocks hurt by signs of US recession, oil slips
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By Louise Heavens
SINGAPORE, Feb 22 (Reuters) - Fresh signs that the U.S. economy may be in recession sent Asian stocks lower on Friday, with Shanghai shedding more than 4 percent, as investors took shelter in the relative safety of government debt. European stock markets are expected to follow suit, although with more modest losses. Spread betters in London are calling Britain's FTSE 100 .FTSE down 0.4 percent, Germany's Dax .GDAXI down 0.7 percent and France's Cac-40 .FCHI 0.8 percent lower.
Concern about the fading U.S. economy dragged crude oil prices further from a record high above $101 a barrel. Platinum was a bright spot, soaring to yet another record high.
The Philadelphia Federal Reserve's business activity index for February was at its lowest level since 2001, providing more evidencethat the U.S. economy may already be in recession. [ID:nN21572086]
"Whether the U.S. is in recession or not, I'll leave it to the economists, but we are going to have an extended downturn simply because the U.S. debt market is in such a difficult state," said Neale Goldston-Morris, head of strategy at Macquarie Equities.
"The market is very edgy at the moment and this will continue for an extended period of time."
Japan's benchmark Nikkei .N225 shed 1.4 percent, handing back most of Thursday's gain, while MSCI's index of other Asian stocks .MIAPJ0000PUS fell 0.9 percent by 0612 GMT. It is 25 percent below its November peak.
For months investors have feared that the United States is sliding into recession and any equity rally has been quickly sapped by bad news -- often yet another credit-related write-down by a big bank.
Only this week Credit Suisse (CSGN.VX) revealed a $2.85 billion write-down and Societe Generale (SOGN.PA), rocked by a rogue trading scandal, said there may be more to come.
Stock markets across Asia fell, with Australia .AXJO, South Korea , Singapore .FTSTI and Hong Kong .HSI falling between 0.4 percent and 1.8 percent.
Shanghai's Composite fell 4.3 percent, going below a level that many analysts regard as important technical support.
CHOPPY AHEAD
"It's meaningless to debate whether a recession is already in the United States or not," said Lee Kyung-soo, an analyst at Daewoo Securities in South Korea.
"The third quarter of 2008 could mark the start of a recovery and stock markets may start reflecting that expectation sometime in the second quarter. Before that, a cycle of rises and falls will likely continue."
Oil kept falling after dropping more than $1 in the previous session as data showing growing stockpiles added to concerns about demand in a weaker United States.
U.S. crude for April delivery CLc1 fell 18 cents to $98.05 a barrel, having shed around a dollar and a half in New York trade.
Precious metal platinum XPT=, used in auto catalysts and jewellery, hit another record high on supply concerns, changing hands at $2,191 an ounce. Gold XAU= was trading at around $948 an ounce.
With the weak U.S. data bolstering the view that the Federal Reserve will cut interest rates again, the dollar hovered near a two-week low against the euro EUR= at $1.481.
Lower rates would erode the currency's appeal to investors seeking high yields.
In the Japanese bond market March 10-year JGB futures 2JGBv1 rose 0.41 point. The 10-year yield fell 3.5 basis points to 1.450 percent JP10YTN=JBTC. (Editing by Alan Raybould)
