By Kevin Plumberg
HONG KONG, May 20 (Reuters) - Asian stocks edged lower on
Tuesday, snapping a six-day rising trend, weighed by retailers
as oil continued a relentless rise, keeping inflation fears
high.
Stocks around the world on Monday rallied to a four-month
peak, despite a record close in U.S. oil prices <CLc1> above
$127 a barrel. However, technology shares dove in late trade
after grim comments from a chipmaker, spreading unease about
the outlook for business and consumer spending.
"It ended up being a mixed day on Wall Street and with oil
prices remaining high, that uncertainty spilled over," said
Malcom Wood, regional strategist with Morgan Stanley in Hong
Kong.
"Food inflation in North Asia may be peaking but oil prices
are complicating things."
Japan's Nikkei average <> slipped 0.4 percent, or
51.76 points, to 14,217.85, after finishing at 14,269.61 on
Monday, the highest since early January.
By 0205 GMT, MSCI's measure of Asia Pacific stocks
excluding Japan was down 0.2 percent on the day at 502.22
<.MIAPJ0000PUS>.
Australia's benchmark S&P/ASX 200 index <> was off
15.7 points, or 0.3 percent, at 5,934.10. Macquarie Group Ltd.
<MQG.AX>, Australia's biggest investment bank, was one of the
biggest drag's on the country's stocks, after the bank said it
would a challenging year for them.
Shares in Seoul were down 13.06 points, or 0.7 percent , at
1,871.99 <>.
China's benchmark Shanghai Composite Index <> edged up
24.75 points, or 0.7 percent to 3,629.55.
The rapid increases in food prices, which have slammed
consumers around the world and confounded political leaders,
appeared to be slowing some but not ending.
U.S. wheat futures rose sharply on worries about how a lack
of rain in key growing areas may have tightened supply in
Australia. Wheat futures rose as much as 1.7 percent, while
soybeans, corn and rice were also up.
"From the bank managers to the farmers to the consumers,
there's a definite strong unease felt by everyone. You can hear
it in the back of their minds, 'oh no not again'," said Garry
Booth of commodities broker MF Global.
Australia's central bank actively considered raising
interest rates earlier this month as inflation was
uncomfortably high, minutes of the May policy meeting showed on
Tuesday.
But on balance the Reserve Bank of Australia decided to
keep rates steady and give its already restrictive monetary
policy time to work, the minutes showed.
The news sent the Australian dollar to a 24-year high
against the U.S. dollar, at US$0.9571 <AUD=>.
The U.S. dollar slipped against the euro and yen after
rebounding overnight on an unexpectedly positive reading of
April U.S. leading indicators suggested the lowest point in the
current economic slump may have passed.
The euro was up 0.1 percent at $1.5531 <EUR=>, while the
dollar was down 0.15 percent at 104.14 yen <JPY=>.
For global investors, focus on Tuesday will likely be on
the May reading of German economic sentiment, particularly
since a reading of U.S. consumer sentiment on Friday plunged to
the lowest in 28 years.
April U.S. producer price data will be due later, although
economists are expecting wholesale price pressures to ease
slightly.
(Additional reporting by Chikako Mogi in Tokyo, Wayne Cole
and Michael Byrnes in SYDNEY, Editing by Jacqueline Wong)
