By Tom Miles
HONG KONG, April 4 (Reuters) - Asian shares eased on Friday
and the dollar made little headway as investors braced
themselves for a U.S. jobs report due later on Friday for a
fresh reading on the state of the economy.
Investors are keenly watching the U.S. economy because its
slowdown is sapping demand and weakening the dollar, a double
headache for Asian exporters dependent on U.S. sales.
Financial bookmakers expect Britain's FTSE 100 <>
index to open as much as 0.3 percent higher and the German DAX
<> to open as much as 0.5 percent higher. The French CAC
40 <> is expected to open around 0.5 percent lower.
The U.S. jobs report will test the mettle of some stock
market investors, who had hoped to have seen the market's
bottom.
Economists expect the non-farm payrolls report to show the
U.S. economy shed a total of 60,000 jobs in March and the
unemployment rate rose to 5.0 percent from 4.8 percent the
previous month. []
"The market will closely watch whether the results of the
U.S. jobs data pour cold water on the market optimism or not,"
said Hideaki Inoue, chief manager of forex trading at
Mitsubishi UFJ Trust Banking.
Share prices have gyrated this year as jittery traders
flipped from seeing a doomsday scenario in one session to
hoovering up cheap stocks in the next.
The latest major surge came this week after global banks
were seen to have drawn a line under the worst of the credit
crisis, but even the Federal Reserve now sees a possibility of
recession.
"Economic prospects remain unusually uncertain, and the
downside risks to growth are significant," San Francisco
Federal Reserve President Janet Yellen said in remarks prepared
for an outlook presentation to the Stanford Institute for
Economic Policy Research.
"It appears that growth in consumption and business
investment spending has slowed markedly after years of robust
performance, and, as a result, the economy has all but stalled
and could contract over the first half of the year."
CAUTION
Asian stock markets traded cautiously, although China,
Taiwan and Hong Kong were all observing the Tomb Sweeping Day
holiday.
Japan's Nikkei average <> closed 0.7 percent lower, as
investors sold to take advantage of a more than 12 percent
rebound since March 17, when the index hit its lowest point
since August 2005.
Stock elsewhere in Asia, as measured by MSCI's index
<.MIAPJ0000PUS> were flat at 0634 GMT, hovering at a one month
high.
Sydney's benchmark S&P/ASX 200 index <> rose 0.2
percent to a fresh five-week high as miners such as BHP
Billiton Ltd <BHP.AX> rose on stronger metals prices, while QBE
Insurance Group Ltd <QBE.AX> gained on an upbeat outlook.
But caution was the watchword as many investors took
profits.
"Indeed, there have recently been signs of improvement for
the U.S. share market and financial system. But the U.S.
economy clearly won't turn on a dime," said Craig James, chief
equities economist at CommSec.
The dollar, which climbed to a three-week high of 102.95
yen <JPY=> on Thursday on electronic trading platform EBS,
slunk back below 102.5 yen. The euro <EUR=> also strengthened
and found support around $1.567.
Gold <XAU=>, traditionally a refuge for investors worried
about turbulence in stocks, trickled back towards $900, giving
up the $5 it gained on Thursday to track a rally in platinum
<XPT=>, which rose on worries about supply problems.
Copper <MCU3> and other metals traded thinly without
Chinese buyers, but here too, the market was glued to the jobs
report.
"There's going to be a lot of wait and see prior to the
data. Obviously, weaker data will certainly exacerbate what is
already quite a sticky situation," said Darren Heathcote of
Investec Australia in Sydney.
"Whilst there's potential for global growth slowing in the
months ahead, I think for the time being at least, while those
stocks are in short supply, we are not going to see copper
prices fall, or at least fall substantially."
Oil <CLc1> also firmed, rising 41 cents to $104.24 a barrel
in Asian trade and recovering from losses in the previous
session due to concerns over U.S. oil demand.
