* Strong China data boosts Asia stocks, global recovery
hopes
* Asia stocks up 0.8 percent in choppy trade
* Euro zone debt problems still linger, limiting gains
* Late Wall St selloff weighs on investor sentiment
By Sugita Katyal
SINGAPORE, June 10 (Reuters) - Asian stocks rose on
Thursday on higher-than-expected Chinese exports and assurances
from Federal Reserve Chairman Ben Bernanke that the U.S.
economic recovery was on solid footing, but European stocks
were expected to open lower, tracking Wall Street's fall
overnight.
The euro steadied near four-year lows against the dollar
but continued to look fragile, with traders awaiting a European
Central Bank meeting later in the day to see if it plans any
fresh steps to help debt-stricken euro zone countries.
[]
Asian markets also drew support from positive comments by
Bernanke, who told the U.S. House of Representatives Budget
Committee that the U.S economic recovery was on track even if
jobs would return only slowly.
Bernanke said that while a double-dip recession "can never
be entirely ruled out," he expected the world's largest economy
to continue growing. []
The World Bank said on Wednesday a slide back into
recession could not be ruled out in some countries if investors
lose faith in efforts in Europe and elsewhere to tackle rising
debt levels. Global stock markets and the euro were given a
boost on Wednesday when sources told Reuters that Chinese
exports had grown about 50 percent in May from a year earlier,
blowing past expectations and offsetting concerns that problems
in Europe could derail the global recovery.
But U.S. stock markets fell in late trade as a host of
negative factors overwhelmed the impact of the China data,
highlighting the skittishness of investors, who have been
quickly selling into any market rallies in recent weeks. []
"With the European debt crisis ongoing, there will still be
caution over its future impact on China's exports," said Zhang
Gang, an analyst at Central Securities.
European shares were expected to open sharply lower on
Thursday ahead of interest rate decisions from the ECB and Bank
of England later in the session.
Britain's FTSE 100 <> was expected to open as much as
1.3 percent lower; Germany's DAX <> was seen down as much
as 0.9 percent, and France's CAC 40 <> was expected to
fall as much as 1.3 percent.
Lingering worries about a slowdown in Europe limited
further gains in Asia on Thursday, even as China's official
data confirmed faster growth, with exports up 48.5 percent in
May from a year earlier and imports up 48.3 percent.
[]
Japan's Nikkei share index <> closed up 1.1 percent,
with the MSCI ex-Japan stock index <.MIAPJ0000PUS> up 0.7
percent. Hong Kong <> recouped early losses to rise 0.2
percent but Shanghai <> slipped as traders took profits on
Wednesday's China-fuelled rally.
The Nikkei's relative strength index remained around 34,
with levels of 30 and below signalling a market has been
oversold.
Australian shares also rose 1.1 percent, with resources
stocks leading the way on higher metals prices, which were
boosted by the strong Chinese data, and on better-than-expected
Australian job figures. Australia is a major supplier of iron
ore and other raw materials to China.
EURO EXTENDS GAINS
The euro extended gains as short-covering picked up pace,
helped by comments from a Chinese pension fund chief who said
the single currency could weather the region's sovereign debt
crisis.[]
The single currency rose as high as $1.2064 on trading
platform EBS, up more than one U.S. cent from an earlier low of
$1.1957. It has risen about 1.5 percent since hitting a
four-year low of $1.1876 on Monday.
The ECB is expected to keep interest rates at a record low
when it meets later on Thursday. Analysts are watching to see
what it can do to shore up sentiment and euro zone economic
growth, which is likely to suffer as heavily indebted
countries
slash their spending to reduce strains on their finances and
give them access to emergency aid. []
The Australian dollar <AUD=D4> rose half a U.S. cent after
datashowed the jobless rate dropping to a four-month low of 5.2
percent, when analysts had looked for an unchanged 5.4 percent.
The New Zealand dollar was up 0.1 percent at $0.6722
<NZD=D4> following a 1 percent rally made after the country's
central bank hiked interest rates from a record low, its first
move since the global crisis.[]
Oil reversed early losses as confirmation of strong Chinese
overall exports in May outweighed weaker demand readings in top
oil consumer the United States.
U.S. crude for July <CLc1> was up 14 cents at $74.52 a
barrel at 0532 GMT, after trading as low as $73.72 before the
export data came out.
(Editing by Kim Coghill)
