* Weak China Feb trade fuels growth worries
* Escalating violence in Libya keeps oil prices up
* Nikkei slips 1.5%; new concern about Portugal
(Updates prices)
By Ian Chua
SYDNEY, March 10 (Reuters) - Asian stock markets and copper
prices fell on Thursday after surprisingly weak Chinese trade
data hit markets already nervous that higher oil prices will cut
global growth.
Investors were also worried about the euro zone's sovereign
debt problem after Portugal on Wednesday saw its cost for
issuing two-year debt soar to its highest level since it joined
the euro in 1999, rekindling fears Lisbon will need a bailout.
That put the euro in a tough position, having recently risen
on the back of expectations of a possible April interest rate
hike by the European Central Bank. The common currency fell to
$1.3870 , well off highs just above $1.40 on Monday.
The combination of negative factors knocked 1.5 percent off
Tokyo's Nikkei average . Stocks elsewhere in Asia
slid 1.3 percent.
U.S. stock index futures were also in the
red, suggesting a weak start for Wall Street.
Technology shares in Asia came under extra pressure after
sector heavyweight Texas Instruments issued a weak
outlook. Samsung Electronics fell 2.7 percent.
Latest data showed China swung to a surprise trade deficit
in February of $7.3 billion, its largest in seven years, as the
Lunar New Year holiday dealt a sharper blow to export activity
than had been expected.
"It's come on a day when commodity prices are off, and
investors are worried about global growth and it's just
accentuated the market pullback," said Shane Oliver, head of
investment strategy at AMP Capital Investors.
"The Lunar New Year does heavily distort Chinese trade data
and I'll be inclined not to read too much into it. But the
market is obviously feeling nervous and has probably read a bit
more into it."
Shanghai copper fell nearly 3 percent after the
weak Chinese trade data cast doubts on demand from the world's
biggest consumer of the metal. Copper on the London Metal
Exchange shed 0.4 percent to $9,235 a tonne.
"The Middle East crisis which sent oil prices surging, as
well as doubts on whether China's copper demand would continue
to boom, have cast a shadow on the market," said Zhu Bin, an
analyst at Nanhua Futures based in China.
U.S. crude rose towards $105 a barrel, not far from a
peak near $107 earlier this week, after forces loyal to Libyan
leader Muammar Gaddafi bombed oil industry infrastructure,
inflicting what could be longer-term damage on the country's
exporting capacity.
Brent crude gained 0.3 percent to $116.26.
Rising oil prices have fuelled worries about inflation,
prompting the Bank of Korea to raise interest rates on Thursday
for a fourth time in less than a year in a bid to keep a lid on
prices.
New Zealand, on the other hand, cut rates as expected to try
to help its economy recover after last month's devastating
earthquake.
Revised data on Thursday showed Japan's economy, the world's
third largest, shrank at a slightly faster annualised pace in
the fourth quarter than initially reported.
But analysts expect improving exports to help the Japanese
economy return to growth this year, although they warned that
high oil prices pose a threat to the outlook.
The rout in stock markets helped lift demand for U.S.
Treasuries, sending the benchmark 10-year yield down
to 3.462 percent, near a one-week low around 3.449 percent set
on Wednesday.
This was despite news the world's largest bond fund had gone
ultra bearish on the United States, dumping all of its U.S.
government-related debt holdings.
(Additional reporting by Gertrude Chavez-Dreyfuss in Tokyo, and
Rujun Shen in Singapore; Editing by Richard Borsuk)
