* MSCI Asia ex-Japan down 0.3 pct, Nikkei falls 0.5 pct
* HSBC Oct flash China manufacturing PMI signal recovery
* Higher Australian inflation data lifts Aussie
* Mild gains seen for European shares, crude up on China
By Chikako Mogi
TOKYO, Oct 24 An HSBC survey of Chinese
manufacturers suggesting growth was recovering in the world's
second largest economy helped trim declines in Asian shares on
Wednesday, though investors remained wary due to weak corporate
earnings worldwide and enduring worries over a global slowdown.
European shares will likely rise, with financial
spreadbetters expecting London's FTSE 100 to open up as
much as 0.3 percent and Paris's CAC-40 seen opening 0.9
The MSCI index of Asia-Pacific shares outside Japan
slid 0.2 percent. China's Shanghai Composite
was up 0.3 percent and was the region's best performing
index. Hong Kong's Hang Seng was little changed.
Japan's Nikkei average recovered slightly from its
earlier 1 percent drop but was still down 0.5 percent dragged
down by weakness in shares of export-oriented firms.
The China HSBC Flash Manufacturing Purchasing Managers Index
(PMI) rose to a three-month high of 49.1 in October, also
registering the most robust order books since April, signalling
a strengthening recovery.
"Recent data have suggested that Chinese growth may have
bottomed out last month, helping to improve market sentiment as
U.S. economic figures have also been hinting at a brightening
recovery trend recently," said Kyoya Okazawa head of global
equities at BNP Paribas in Tokyo.
In a sign of capital flows back to the region, particularly
into Hong Kong, the territory's de facto monetary authority has
intervened thrice in the currency market since last Friday to
curb the Hong Kong dollar's strength after it hit the top-end of
its trading band.
But corporate earnings were a bigger focus for South Korean
shares, which fell 0.7 percent, as lacklustre results in
local and international markets weighed on investor sentiment.
Shares of market heavyweight Samsung Electronics
fell a percent while Hyundai Motor was off 2.7
The dollar was steady against the yen at 79.82 yen,
having hit its highest since early July of 80.02 on Tuesday.
The Australian dollar rose to a high of $1.0317
after the PMI report on China, having earlier risen from around
$1.027 following data showing Australian consumer prices
increased a surprisingly large 1.4 percent last quarter,
lowering expectations for interest rate cuts.
The Aussie rose 0.5 percent against the yen to 82.33 yen
, helping the euro to steady against the yen at 103.70
yen. The euro touched a 5/1-2 month high against the
yen of 104.45 on Tuesday.
Markets may remain cautious, but their response "is more
geared towards consolidating risky assets near lower levels that
justify bearing the risk, rather than the pre-announcing more
difficulties to come", Barclays Capital said in a research note.
On Tuesday, U.S. stocks fell, with the Dow industrials
suffering the biggest drop since June 21 after DuPont and United
Technologies showed profit growth slowing, adding to a string of
disappointments from companies falling short of Wall Street's
U.S.-listed shares of foreign companies slid across the
board on Tuesday, also on fresh worries over the euro zone's
debt crisis as Spanish bond yields rose after Moody's Investors
Service downgraded five of Spain's regions.
Spot gold was steady at $1,708.59 an ounce after
falling 1.2 percent to a six-week low of $1,703.50 on Tuesday as
other assets fell.
U.S. crude rose 0.6 percent to $87.18 after settling
at a three-month low of $86.67 on Tuesday. Brent crude futures
were up 0.7 percent at $108.83.
The euro recovered to $1.2980 from Tuesday's low of
$1.2952, but well below last week's high of $1.3140. The euro's
low this month was around $1.2804.
Investors continue to wait both for Spain to ask for aid to
help manage its huge public debts with external funds, and for
Greece to agree to conditions attached by its global lenders in
exchange for a further bailout.
Germany's Sueddeutsche Zeitung paper reported in its
Wednesday edition, without citing sources, that euro zone states
will grant Greece an extra two years to bring its budget deficit
to within agreed targets.
The euro could be pressured if initial readings of euro zone
purchasing managers' index and a German Ifo business sentiment
survey due later on Wednesday signal further deterioration.
U.S. Federal Reserve Chairman Ben Bernanke has told close
friends he probably will not stand for a third term at the
central bank even if President Barack Obama wins the Nov. 6
election, the New York Times reported.
Under Bernanke, the Fed has taken aggressive easing policies
to help underpin the tepid U.S. recovery. The Fed is unlikely to
take fresh steps when it ends a two-day meeting on Wednesday,
opting to assess the impact of last month's aggressive
quantitative easing measures.