GLOBAL MARKETS-Asian stocks hit 7-week low, dollar weak

                                
 By Rafael Nam
                                
 HONG KONG, March 10 (Reuters) - Asian stocks hit their
lowest in nearly seven weeks on Monday, while the dollar was
near a record low against the euro and an eight-year low
against the yen after weak employment data fuelled U.S.
recession fears.
                                
 Malaysian stocks were among the region's biggest decliners,
falling as much as 7.6 percent to a seven-month low after the
ruling coalition suffered its worst election result in decades.
                                
 Inflationary pressures remain a concern around Asia. Data
on Monday showed South Korean producer prices rose 6.8 percent
in February from a year before, the biggest gain in over three
years, while Chinese producer prices were up 6.6 percent.
[ID:nSEU000008] and [ID:nPEK229240]
                                
 Oil prices remained near a record high despite the
worsening global economic outlook, held up by cold weather in
parts of the United States, while gold moved back above $975 an
ounce.
                                
 "We keep hearing bad news, and expect to receive more
unfavourable sets of data and figures for some time. Markets
will continue to test the bottom in the meantime," said Kim
Joong-hyun, an analyst at Goodmorning Shinhan Securities in
Seoul.
                                
 The MSCI measure of Asian stocks outside Japan
<.MIAPJ0000PUS> was down 2.4 percent by 0338 GMT after hitting
its lowest since Jan. 23.
                                
 The prospects of a U.S. recession and worsening global
credit conditions have hit Asian stocks hard this year, with
the MSCI index down 14 percent as of last week, worse than the
12 percent fall in the Standard & Poor's S&P 500 <.SPX> or the
10 percent drop in the Dow Jones industrial average <.DJI>.
                                
 Exporters such as Sony Corp <6758.T>, which depend on U.S.
consumers, dropped after data published on Friday showing U.S.
employers unexpectedly cut jobs last month at the steepest rate
in nearly five years. [ID:nN07310787]
                                
 Financial firms fell on concerns about more writedowns
worldwide after U.S. housing loan provider Thornburg Mortgage
Inc <TMA.N> said on Friday it could not meet its own lenders'
demands for $610 million of cash or collateral. [ID:nN07344671]
                                
 "The subprime problem is a creeping disease. It initially
infected relatively few people, but the contagion has spread to
a much greater portion of the credit market," MF Global analyst
Edward Meir said.
                                
 Japan's Nikkei average <.N225> hit its lowest level since
September 2005 and was down 1.6 percent at 0418 GMT.
                                
 Shares in China <.SSEC>, Taiwan <.TWII> and Singapore
<.FTSTI> were down more than 2 percent, while stock markets in
South Korea <.KS11>, Hong Kong <.HSI> and Australia <.AXJO>
were down nearly 2 percent.
                                
 China Railway Construction made a weaker-than-expected
Shanghai debut after raising a combined $5.4 billion in a dual
listing with Hong Kong in the world's largest initial public
offering this year. [ID:nSHA204900]
                                
 MALAYSIAN STOCKS DROP
                                
 Malaysia's main share index <.KLSE> slumped 6.9 percent, at
one stage hitting its lowest since August 2007, after
opposition Islamists and leftists won control of five of the
country's 13 states and just over a third of the federal
parliament. [ID:nSP84655]
                                
 "The political stability of the country becomes a question
mark," said Pankaj Kumar, chief investment officer at Kurnia
Insurance.
                                
 Despite a surprisingly big jump in Japanese machinery
orders [ID:nT17328] -- a notoriously volatile series -- and the
South Korean finance ministry's confidence in its 2008 economic
growth target of around 6 percent [ID:nSEO214128], the weakness
of the U.S. economy remained the dominant theme for investors.
                                
 The dollar continued this year's slump, falling around 0.4
percent from Friday to 102.34 yen <JPY=>, near an eight-year
low of 101.40. The euro rose 0.2 percent to $1.5381 <EUR=>,
near a record high of $1.5465 hit in electronic trade on
Friday.
                                
 The falling value of the world's dominant currency has been
a major factor behind this year's surge in commodity prices.
                                
 Oil prices edged lower on Monday, with U.S. light crude for
April delivery <CLc1> down 24 cents at $104.91 a barrel, but
that was still within sight of the record $106.54 hit on
Friday.
                                
 Gold <XAU=> moved back up above $975 an ounce from around
$972 in late Friday trade in New York, while platinum <XPT=>
firmed to around $2,065 an ounce from $2,020/$2,030.
                                
 Asian bonds extended gains, with Japanese government bond
futures climbing to a 2-1/2-year high. March futures <2JGBv1>
rose 0.38 point to 139.43.