* Euro flirts with 4-mth low vs. dollar
* 24 bln in European govt debt expected next wk: Commerzbank
* Asian stocks ease ahead of U.S. payrolls report
* Materials, energy weaker as dlr strength weighs on commods
By Vikram S.Subhedar
HONG KONG, Jan 7 (Reuters) - The euro fell to a near
four-month low against the dollar on Friday while Asian stocks
eased as investors awaited U.S. payroll data for more evidence
of a stronger U.S. economic recovery.
The dollar remained supported by an unexpectedly strong
ADP employment report earlier in the week which showed a
record number of private sector jobs created in December and
prompted economists to raise their forecasts for the payrolls
data.
"The much stronger than anticipated ADP outcome, alongside
the nascent wave of optimism on the U.S. economy, appears to
have fed expectations for a much higher payrolls reading
today," said forex analysts at Citigroup in a note.
The shift in expectations has been associated with
relatively large moves across asset classes, said the analysts.
According to Citigroup, the rise in two-year U.S. treasury
yields and the rise of the dollar against the yen and euro
mark the largest pre-payroll moves over the past five months.
The dollar index , which measures the greenback's
performance against a basket of major currencies, hit a high
of 80.936, a level last seen in early December. It last traded
slightly higher at 80.838.
At the same time, a selloff in peripheral euro zone
government bonds before a flurry of supply next week and an EU
proposal that could force those who lend to banks to bear big
losses should they fail helped knock the euro lower
across the board. []
The single currency fell to as far as $1.2965 on trading
platform EBWS, its lowest since mid-September, before edging
back to around $1.2990.
Next week will see around 24 billion euros of new European
government debt supply hitting the market, including bond
issues from Italy, Portugal and Spain, according to Commerzbank.
The inability of the euro to benefit from upbeat German
manufacturing data or a jump in euro zone economic sentiment
made the market even more nervous about the single currency.
Another key event is Federal Reserve Chairman Ben
Bernanke's testimony on the U.S. economic outlook before the
Senate Budget Committee on Friday after the jobs report which
investors will be watching for updates on the Fed's plan to
keep its bond-buying program in place through June.
Asian stocks eased after stocks on Wall Street slipped on
Thursday. Soft retail sales in the U.S. and a sharp rise in
dollar left investors edgy a day before the payrolls report.
The MSCI Asia ex-Japan index was down 0.3
percent with materials and energy shares underperforming as
the stronger dollar weighed on commodity prices.
Shares of Samsung Electronics , the world's
No.1 memory chip maker, fell 1 percent after the company
forecast weaker-than-expected fourth-quarter earnings. Samsung
shares are up nearly 25 percent over the past quarter and
hovering near record highs. []
Most analysts see the blip as temporary with demand for
many of the company's products picking up.
"I think the fourth-quarter results will mark the bottom.
Although its DRAM chip sector may remain in a slump in the
first quarter, other businesses such as LCD will provide a
boost," said SK Securities analyst Hwang Yoo-Sik.
Japan's Nikkei slipped 0.2 percent from an
eight-month high.
"Investors in Japan are also cautious about the U.S. jobs
data, so they may just stay on the sidelines today," said
Masatoshi Sato, senior strategist at Mizuho Investors
Securities, adding that a weakening yen kept the market mood
upbeat.
Investors will look ahead to the start of the U.S.
corporate earnings reporting season for signs of whether the
recovering global economy is playing through to stronger
profits.
Earnings season kicks off next week with aluminum producer
Alcoa , oil major Chevron and technology
bellwether Intel Corp all expected to provide
insights into global growth and demand.
(Editing by Kim Coghill)
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