May 3, 2012 / 12:25 AM / 7 years ago

GLOBAL MARKETS-Asian shares slip as data casts doubt on recovery

* MSCI Asia ex-Japan down 0.3 pct, Hang Seng falls 0.4 pct

* Major European indexes seen up 0.3-0.5 percent

* Euro trades around $1.3145, near 2-week low

* Gold falls below $1,650 an ounce, copper below $8,300 a tonne

By Alex Richardson

SINGAPORE, May 3 (Reuters) - Asian shares slipped on Thursday and the euro languished near a two-week low after disappointing economic data from both sides of the Atlantic rekindled concerns about the strength of global growth.

Commodities and the Australian dollar - all sensitive to growth expectations - also struggled as the data put investors on the defensive and limited appetite for riskier assets.

But European stock markets were seen opening stronger, fueled by hopes that a European Central Bank policy meeting later in the session will prepare the ground for further stimulus measures.

Financial spreadbetters were calling major European indexes

to open up 0.3-0.5 percent.

“Persistent weakness in the euro zone has buoyed hopes for some further stimulus from the ECB and bulls are still hanging onto hopes of a liquidity-pumped rally,” said Jonathan Sudaria, a dealer at London Capital Group.

U.S. stocks eased on Wednesday as data showed a slowdown in private sector hiring, tempering the optimism from a better-than-expected manufacturing survey at the start of the week that had driven the Dow to its highest in more than 4 years.

The weakness continued in Asia, where MSCI’s broadest index of Asia Pacific shares outside Japan fell 0.3 percent, its first decline this week, with Hong Kong shares down 0.4 percent.

Tokyo financial markets were closed for a public holiday.

The weaker than expected U.S. jobs data focused attention on the broader non-farm payrolls report due on Friday.

“With those numbers still ahead of us people are going to be a little bit hesitant to jump into the market right at the present,” said Angus Gluskie, portfolio manager at White Funds Management in Sydney.

Generally improving economic data from the United States has buoyed equity markets in 2012 after a broad retreat in the second half of 2011, with the MSCI Asia ex-Japan up around 13 percent on the year to date and Wall Street’s S&P 500 gaining near 12 percent.


The euro fell nearly 1 percent to $1.3122 on Wednesday and European stocks also dropped after a survey showed euro zone factories sank further into decline last month, with the downturn hitting Italy and Spain hard and appearing to take root among core members France and Germany.

Separate data showed the unemployment rate rising to equal the euro zone record high of 15 years ago, driven by increases in Italy and Spain.

With recently-downgraded Spain looking to raise funds in the bond market on Thursday, the ECB will be under pressure at its policy meeting later to do more to shield weaker euro zone members from additional pain.

“It seems too early for another wave of easing, but that is where the risks are skewed. The outcome is continued downward pressure on EUR/USD,” said Sebastian Galy, strategist at Societe General.

The euro traded around $1.3145 on Thursday, down around 0.1 percent on the day.

Commodity markets struggled for traction, with U.S. crude slipping a few cents but holding above $105 a barrel, while Brent crude rose 13 cents to $118.33. Oil fell its most in two weeks on Wednesday on the disappointing data and a build-up in inventories in top consumer the United States.

“Risk markets are overall very cautious ahead of this non-farm payrolls data, that’s why we’re seeing reduced volumes and a few bets being taken off the table,” said Ben Le Brun, market analyst at OptionsXpress in Sydney.

Copper fell 0.3 percent to below $8,300 a tonne and gold, which in recent months has lost its safe-haven appeal and mostly tracked the performance of riskier assets, dipped 0.2 percent to around $1,648 an ounce.

The Australian dollar, sensitive to demand for the commodities that drive the Australian economy, eased 0.2 percent to around $1.0305.

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