* Asian stocks near 5-mth lows as investors sell risky
* Dollar rises given fears over sovereign debt in Europe
* Ailing euro rebounds on speculation of Swiss intervention
* Strategist predicts worse to come for Asian stocks
* Oil steady after plunging nearly 5 percent on Thursday
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By Dean Yates
SINGAPORE, Feb 5 Asian stocks fell to near
five-month lows on Friday as investors dumped riskier assets
after rising sovereign debt problems in the euro zone and poor
jobs data sent U.S. and European stocks tumbling.
The U.S. dollar extended gains from the previous session as
investor anxiety about sovereign debt in Greece, Portugal and
Spain sparked a sell-off in the euro and growth-linked
currencies such as the Australian dollar.
But the euro rebounded slightly on Friday against the Swiss
franc on rumours that the Swiss central bank had intervened to
weaken its own currency. Overnight, the euro had hit its lowest
level in more than eight months against the dollar and plunged
to a 15-month low against the Swiss franc EURCHF=.
Asian stock markets and commodity prices recoiled on fears
that growing euro zone troubles could impede or even derail the
global economic recovery.
An unexpected rise in U.S. unemployment claims heightened
those concerns ahead of non-farm payrolls data due later on
Friday, a number that will be closely watched by markets for
signs of an improvement in America's jobless rate.
Japan's Nikkei average .N225 dropped more than 3 percent
to its lowest in seven weeks, with exporters hurt by a stronger
yen as well as the escalating problems in Europe. The yen, like
the dollar, has firmed as investors move into assets
traditionally seen as safe havens in times of market turmoil.
Dariusz Kowalczyk, chief investment strategist at SJS
Markets in Hong Kong, said worse may lay ahead for Asian stocks
in the second quarter.
He said the waning impact of fiscal stimulus measures in big
economies would trigger a double-dip recession in the United
States, Europe and Japan by the end of the year, and that
markets would see it coming.
"When it comes to equities, markets usually anticipate
changes in the direction of the global economy about two
quarters before they occur," Kowalczyk said.
"Obviously when you look at what's happening with the
market this year, some might say the correction has already
begun. But I think this correction, while it is painful, is not
the major one that will come ahead of the double dip."
Asia Pacific stocks outside Japan as measured by MSCI
.MIAPJ0000PUS fell more than 3 percent to levels last seen in
early September. Declines were led by resource stocks, which
fell 4 percent as commodity and energy prices fell on worries
about the strength of the global recovery.
Asian stocks outside Japan have fallen close to 9 percent
this year after rising 68 percent in 2009 on the back of
government measures worldwide that stimulated spending and
dragged the global economy back from the abyss.
Australian shares fell 2.8 percent. Top miners Rio Tinto
Ltd (RIO.AX) slumped 5.6 percent and BHP Billiton Ltd (BHP.AX)
lost 3.9 percent. Both were especially hard hit by a slump in
commodities prices as the U.S. dollar jumped. In Hong Kong, the
benchmark Hang Seng Index .HSI was down 3 percent.
The euro jumped to the day's high of 1.4905 francs
EURCHF= on EBS after falling as far as 1.4551 francs, its
lowest since October 2008, and later held around 1.4730 francs,
up 0.6 percent on the day.
Traders said it was not clear if the Swiss central bank had
actually intervened to buy euros and sell the Swiss franc,
although there was talk it had used trading platform EBS.
The Swiss National Bank bank has pledged to stem a
sharp-run up in the france against the euro because its fears a
stronger franc will erode the country's export competitiveness
and threaten its broader recovery.
The euro had dropped to levels which could prompt
intervention and the market was wary of the possibility.
The weakness in the euro was partly attributed to widening
Greek, Portuguese and Spanish bonds' yield spreads over German
In Asian trade, the dollar index .DXY=USD surged past
80 for the first time since mid-July 2009 while the euro EUR=
fell to as low as $1.3710, which was its lowest since May 2009.
Major U.S. stock indexes fell as much as 3 percent
overnight, their worst losses in more than nine months, with
the Dow .DJX briefly dipping below the significant 10,000
Financial, commodity and materials sectors were all hit
hard by fears of escalating government debt problems in Greece,
Portugal and Spain. [ID:nLDE6130RE]
"I think it's a confidence issue right now. We definitely
do need to see unemployment in the U.S. start to decline before
consumption can really start to pick up," said Lorraine Tan,
director of Asia equity research at S&P in Singapore.
Shanghai copper was seen falling around 3 percent after a
plunge in London sent the metal to it lowest in more than three
Oil CLc1 rose 27 cents to $73.41 per barrel, after its
biggest one-day drop since July in the previous session as the
(Editing by Kim Coghill)