* Stocks slip after S&P suffers biggest loss since April
* US dollar well supported on speculation of early Fed rate rise
* Global manufacturing surveys, US payrolls loom large
* Gold melts to a 6-week low, oil hits 4-month trough
By Wayne Cole
SYDNEY, Aug 1 Asian shares stumbled on Friday after a month-end swoon on Wall Street, though some were hoping China would offer better news on manufacturing and help steady investor sentiment.
The Chinese surveys on industrial activity come in two flavours, one from the government and one from HSBC. Analysts generally expect both to show a pick-up in July as Beijing's stimulus efforts gain traction.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.5 percent. Japan's Nikkei lost 0.6 percent, while the broader Topix fell 0.7 percent.
Relief was sorely needed after the Dow sank 1.88 percent, while the S&P 500 shed 2 percent and the Nasdaq 2.09 percent. MSCI's All-World Index lost 1.5 percent and European shares 1.2 percent.
The drop in the S&P 500 was the biggest since April and it suffered the first monthly loss since January. The stress was evident in the VIX volatility index which jumped 27 percent to the highest since mid-April.
"There was no single and obvious catalyst," said Westpac strategist Imre Speizer. "Geopolitical factors, fear of Fed tightening, Portuguese banking sector concerns, Argentina's default, and profit-taking all probably in the mix."
Argentina defaulted on its debt for the second time in 12 years, while shares in Portugal's Banco Espirito Santo plunged 42 percent after the bank posted a 3.6 billion euro loss.
Some blamed data showing that U.S. labour costs recorded their biggest gain in more than 5-1/2 years for stoking speculation the Federal Reserve could raise interest rates sooner than previously thought.
Yet, after an initial wobble, Fed funds futures <0#FF:> rallied through the day and actually pared back the probability of an earlier hike.
Likewise, yields on two-year Treasury paper dropped back to 53 basis points having been as high as 59 basis points on Wednesday.
DOLLAR UP, OIL DOWN
Aiding bonds was an unexpected, and inexplicable, 10-point plunge in the Chicago purchasing management index to 52.6 in June. That was the sharpest drop since late 2008 and sparked talk the national survey of manufacturing, known as the ISM, might surprise on the downside later on Friday.
Also due is the always-influential U.S. payrolls report for July. While analysts expect another healthy gain of 233,000, a further drop in the jobless rate could add to investor jitters over interest rates.
All the muttering about when the Fed might hike has been a boon for the U.S. dollar in recent weeks. Measured against a basket of its peers, the dollar gained 2 percent in July for its best monthly performance 1-1/2 years.
The dollar bought 102.80 yen, after peaking at a four-month high of 103.15, while the euro traded at $1.3388 and still uncomfortably close to the nine-month trough of $1.3366 plumbed earlier in the week.
Still, if investors really were worried about U.S. inflation it did not show in the gold market, where the metal dropped to a six-week trough of $1,282 having shed 1 percent on Thursday.
Oil prices also took a spill amid signs of plentiful supply, which has potentially positive implications for global inflation and economic growth.
U.S. crude oil fell to its lowest since March around $97.90 a barrel, while Brent was off 25 cents at $105.77. Brent lost more than 6 percent in July, its biggest monthly decline since April 2013. (Editing by Eric Meijer)