* U.S. GDP, weekly jobless claims worse than expected
* Japanese banks slide on domestic worries
* Oil retreats, pressured by bearish U.S. economic data
(Adds quotes, detail, Europe open, updates prices)
By Tom Miles
HONG KONG, Aug 1 (Reuters) - Weak U.S. economic data and a
grim outlook for Japanese banks caused Asian stocks to sag and
safe-haven bonds to rise on Friday, while oil fell further
after its biggest monthly drop since 2004.
Hopes of a speedy economic recovery were dented by a
surprise jump in U.S. weekly jobless claims, a lower than
expected second-quarter gross domestic product and a shock
revision of data that showed the U.S. economy shrank in the
final quarter of 2007, revealing a brush with recession.
Asian shares slumped, with Tokyo stocks hitting a two-week
low, troubled by the performance of Japanese banks after sharp
declines in first-quarter profitability at Mizuho Financial
Group <8411.T> and Sumitomo Mitsui Financial Group <8316.T>.
Financial bookmakers called for Britain's FTSE 100 <>
index to open down 28-35 points, or as much as 0.6 percent,
Germany's DAX <> down 31-32 points, or 0.5 percent, and
France's CAC down 27 to 31 points, or 0.7 percent.
"The global economic outlook is deteriorating and corporate
earnings are also getting worse -- together they are creating
selling pressure," said Yoku Ihara, manager at investment
information department at Retela Crea Securities in Japan.
Tumbling profits caused Japanese electronics maker NEC Corp
<6701.T> to plummet 16.5 percent, its worst one-day fall in 21
years [], contributing to a 2.1 percent drop in the
Nikkei average <>.
Investors were also cautious ahead of a U.S. July
employment report later on Friday. Economists polled by Reuters
expect it to show that companies shed 75,000 workers in July,
making that the seventh straight month of job losses.
MSCI's index of Asia stocks outside Japan <.MIAPJ0000PUS>
sagged 1.4 percent.
Sydney's S&P/ASX 200 index <> fell 1.5 percent and
Hong Kong's Hang Seng index <> eased 1.5 percent.
"This has been a week of unusually low turnover with
investors unable to find any investment ideas," said Linus yip,
strategist with First Shanghai Securities in Hong Kong.
"Now investors are clear that nothing will change
fundamentally for as long as U.S. housing prices and sales keep
on the decline. All the measures taken so far have only worked
around this problem without looking to fix it."
The flight from equities into safe-haven securities caused
the yield on 10-year Japanese Government Bonds <JP10YTN=JBTC>
to touch a three-month low of 1.505 percent on Friday, although
trade remained relatively light ahead of the U.S. data.
OIL CHECKS DOLLAR SLIDE
Equities took little heart from a continuing sell-off in
oil, normally a sign of cheaper fuel for energy-hungry
companies and stretched consumers.
U.S. crude oil fell 0.6 percent to $123.33 a barrel <CLc1>
after plunging more than 2 percent on Thursday. That capped the
market's worst month in more than three years, as weak U.S.
economic figures reinforced worries about shrinking demand in
the world's top energy consumer.
"High oil prices are taking their toll on western
economies. Prices are now on a downward trend due to weaker
U.S. economic data," said Gerard Rigby of Fuel First Consulting
in Sydney.
Demand worries have pulled oil down from a record above
$147 a barrel hit on July 11, the peak of a six-year rally set
in motion by an Asian economic boom. Oil's 11.4 percent loss
for the month of July marked the biggest monthly loss in
percentage terms since December 2004.
The fall in oil contributed to the steepest monthly drop in
28 years for the Reuters-Jefferies CRB <.CRB> commodities
index, which lost 10 percent in July, the biggest drop since
March 1980. The index had gained almost 20 percent in the
April-June quarter.
Oil's decline helped to slow the dollar's slide. It hovered
around 107.52 yen <JPY=> as Europe's trading day began.
The dollar also edged up towards a one-month high against
the euro <EUR=>, with investors viewing the U.S. jobs report as
a key hurdle for whether the U.S. currency can sustain its
rebound.
"The euro appears to be peaking out. The ECB hiked rates in
July and inflation still remains a threat, but indicators this
week did not show euro zone economic conditions in a positive
light," said Takahide Nagasaki, chief forex strategist at Daiwa
Securities SMBC.
The euro fell 0.2 percent to $1.5565 <EUR=>. Traders said a
recent string of weak European data was weighing on the euro
against the yen in Asian trade and undermining the euro versus
other currencies.
(Additional reporting by Masayuki Kitano, David Dolan and
Shinichi Saoshiro in TOKYO, Parvathy Ullatil in HONG KONG;
Editing by Lincoln Feast)
