* Spreadbetters expect mixed European open
* Stocks dip after data shows slowing China money supply
* Dollar holds ground vs euro, yen after overnight bounce
By Shinichi Saoshiro
TOKYO, April 15 Nerves got the better of Asian
share markets on Tuesday as they turned lower after an upbeat
U.S. retail sales report was eclipsed by soft data from China,
providing a stark reminder to investors of the headwinds facing
the world's second-largest economy.
The MSCI's broadest index of Asia-Pacific shares outside
Japan lost 0.3 percent, handing back earlier
modest gains made after the U.S. data had helped Wall Street
bounce from a sharp selloff in recent days.
Financial spreadbetters see cautious start to trading in
Europe, tipping Britain's FTSE 100 to open flat, and
Germany's DAX and France's CAC 40 to eke out
Data released on Tuesday showed China's money supply grew
at the weakest pace in more than a decade in March in another
sign of softening economic momentum. Global
markets have been buffeted in recent months by a spate of weak
Chinese data, raising concerns of a deepening economic slowdown.
The Shanghai Composite Index lost 0.9 percent, and
trading in much of the rest of Asia lacked conviction to lift
The tense geopolitical backdrop in Ukraine kept investors on
edge, which also undermined risk appetite.
Ukraine's president threatened military action after
pro-Russian separatists occupying government buildings in the
east ignored an ultimatum to leave and another group of rebels
attacked a police headquarters in the region. The flare-up came
less than a month after Russia completed its annexation of
Ukraine's southern Crimea peninsula.
Japan's Nikkei bucked the trend and rose 0.8 percent
after skidding to a six-month low on Monday.
On Monday, encouraging retail sales from the world's biggest
economy, which had been bogged down by a harsh winter, gave some
respite for the Standard & Poor's and Nasdaq indexes, which had
just suffered their worst week since June 2012.
In the currency markets, the dollar held steady after the
solid U.S. retail sales data. The euro remained under pressure
on weekend comments from European Central Bank officials,
including ECB President Mario Draghi, who rekindled speculation
about more easing in the euro zone.
The dollar stood at 101.91 yen, little changed from
late New York trade on Monday, when it pulled away from a
three-week trough of 101.32 hit late last week.
The euro was also steady at $1.3815, having been
knocked off a three-week peak of $1.3906 hit last week on the
back of the dovish comments from ECB officials.
"Jawboning by policymakers and the risk of more stimulus
should be enough to put a top in the EUR/USD but unfortunately
there are other factors at play that are out of the ECB's
control," Kathy Lien, managing director of FX strategy at BK
Asset Management, wrote in a note to clients.
"With the European Sovereign Debt crisis in the distant
memory, capital inflows are returning to Europe, creating demand
for euros. At the same time, there is very little upside
momentum in U.S. yields even after today's strong retail sales
report," Lien said.
U.S. Treasuries yields rose on Monday as stocks gained on
the better-than-expected retail sales data, but the 10-year U.S.
Treasury note was still at 2.644 percent, not far
from a six-week low of 2.603 percent hit on Monday.
Nickel dipped after 11 straight sessions of gains but still
traded within reach of a 14-month high of $17,917 a tonne scaled
on Monday in the wake of Indonesia's ongoing ore export ban, now
in its third month, and prospects of tougher sanctions on
Russia, a leading producer of the metal.
Three-month nickel on the London Metal Exchange was
at $17,661 a tonne.
"The Indonesia story has not changed ... there is no sign
yet that there might be any reversal of the policy," Natixis
analyst Nic Brown said.
"And I think when you hear the Americans starting to talk
about potential sanctions on Russia, people instinctively look
at palladium and nickel: two metals that could be affected
either by sanctions or by Russian retaliation."
Gold fell back from its three-week high of $1,330.90 touched
on Monday when renewed concerns over hostilities in the Ukraine
increased the precious metal's safe-haven appeal.
Spot gold traded at $1,321.75 an ounce with the
strong U.S. data offsetting some of the safe-haven bids.
Brent crude futures dropped below $109 a barrel
following a surge to a six-week high in the previous session, as
investors looked ahead to a meeting in Geneva that they hoped
would bring a political resolution to the escalating crisis in
U.S. wheat futures clung much of its gains after surging
nearly 3 percent on Monday on tensions in the breadbasket Black
Sea region coupled with a threat of freeze damage to crops in
the U.S. Plains.
Chicago Board of Trade wheat for May delivery edged
down 0.2 percent to $6.77-3/4 per bushel.
(Additional reporting by Susan Thomas and Eric Onstad in
London; Editing by Shri Navaratnam)