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GLOBAL MARKETS-Asian shares dip on caution over global growth, US earnings

Published 12/04/2019, 02:17 pm
Updated 12/04/2019, 02:20 pm
© Reuters.  GLOBAL MARKETS-Asian shares dip on caution over global growth, US earnings
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* MSCI Asia ex-Japan -0.1 pct

* Volumes seen low ahead of U.S. 1Q earnings season

* Euro jumps on Japanese demand

* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Andrew Galbraith

SHANGHAI, April 12 (Reuters) - Asian shares turned lower on Friday as trepidation ahead of the start of the U.S. corporate earnings season and underlying anxiety over the global growth outlook eclipsed some reassuring U.S. economic data.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was last down 0.1 percent, having see-sawed within a tight range throughout the morning session

Despite broad weakness in the region, with Chinese blue-chips .CSI300 down 0.8 percent ahead of the release of trade data, higher Chinese iron ore prices helped to push Australia's S&P/ASX 200 index .AXJO up 0.7 percent.

Japan's Nikkei stock index .N225 gained 0.5 percent.

Michael McCarthy, chief market strategist at CMC Markets and Stockbroking in Sydney, said markets were in a "holding pattern" as they waited on Chinese trade data and the U.S. earnings season.

Matt Simpson, senior market analyst at GAIN Capital in Singapore, said a dovish shift by central banks, together with possible progress on a U.S.-China trade deal and U.S. President Donald Trump's talking up of the markets could help to support equities in the coming weeks.

"Consumer discretionary and information technology are more than outperforming the S&P 500 rebound, and that generally is what you see in the start of an upswing, not near the end of a cycle," he said.

The tepid performance of Asian markets Friday followed a choppy session on Wall Street that left major indexes treading water, hemmed in by anxiety ahead of corporate earnings and worries about a global economic slowdown, which capped gains stemming from upbeat U.S. economic data.

The Dow Jones Industrial Average .DJI fell 0.05 percent to 26,143.05, the S&P 500 .SPX closed flat at 2,888.32 and the Nasdaq Composite .IXIC dropped 0.21 percent to 7,947.36.

Tempering expectations for a sharp slowdown in U.S. growth as data that showed the number of Americans filing applications for unemployment benefits dropped to a 49-1/2-year low last week from U.S. Federal Reserve Vice Chairman Richard Clarida that the U.S. economy is in a "good place" but reemphasising the Fed's patience on rate hikes, also helped to reassure investors. of the big takeaways from the past few days has been the broad decline in volatility across markets," National Australia Bank (NAB) analysts said in a morning note. NAB attributed the muted reaction to recent events to dovish policy shifts by central banks, signs that China's stimulus measures are having an effect, continued U.S.-China trade talks and the Brexit delay.

International Monetary Fund Managing Director Christine Lagarde said on Thursday that the six-month delay of Britain's exit from the European Union avoids the "terrible outcome" of a "no-deal" Brexit, but does nothing to lift uncertainty over the final outcome. ongoing threats to the health of the global economy, IMF Deputy Managing Director Mitsuhiro Furusawa warned that a bigger-than-expected slowdown in China's economy remains a key risk to global growth. Treasury yields inched lower amid the cautious retreat in shares, after earlier rising on the U.S. jobless claims data, stronger producer prices and a weak 30-year bond auction. Friday morning, the yield on benchmark 10-year Treasury notes US10YT=RR fell to 2.497 percent compared with its U.S. close of 2.504 percent on Thursday. The two-year yield US2YT=RR was unchanged at 2.356 percent.

In currency markets, the dollar was up 0.1 percent against the yen at 111.75 JPY= , but a strong gain in the euro EUR= , which jumped 0.36 percent on the day to buy $1.1290, pushed the dollar index .DXY down 0.2 percent to 96.979.

Traders said demand for the euro jumped among Japanese players amid speculation toward cross-border flows.

U.S. crude CLc1 ticked up 0.35 percent at $63.80 a barrel, while Brent crude LCOc1 was up 0.28 percent at $71.03 per barrel.

Gold was flat after falling more than 1 percent on Thursday to break below the key $1,300 level following solid U.S. data. Spot gold XAU= traded at $1,292.03 per ounce. GOL/

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