GLOBAL MARKETS-Investors brace ahead of Fed, US growth data

                                
  (Updates prices, adds European opening, adds details)
                                
 By Tom Miles
                                
 HONG KONG, April 29 (Reuters) - Asia stocks stalled near
three-month highs on Tuesday ahead of a U.S. interest rate
decision and economic data that could draw a line under the
downturn or send markets back into the recession-watch of
February and March.
                                
 Trading was subdued as Japan's markets were closed for the
first of a string of Golden Week holidays and investors
elsewhere hunkered down, with thin trade in stocks and a weak
oil market that saw crude slip back from Monday's record close
to $120 a barrel.
                                
 Financial spread-betters saw European markets opening
broadly flat, with London's FTSE 100 <.FTSE> up 2-3 points,
Germany's DAX <.GDAXI> between 8 points down and 2 points up
and France's CAC 40 <.FCHI> between 6 points down and 1 point
up.
                                
 Investors are anxious to see if the U.S. Federal Reserve
will draw a line under the credit crisis on Wednesday by
signalling its run of rate cuts is coming to an end. They also
want to hear if the U.S. economy managed to grow in the first
quarter, which would be enough to stave off recession for
another three months.
                                
 The answer will come on Wednesday, with economists
projecting an annualised 0.2 percent growth rate.
[ID:nSP245205]
                                
 Whatever the figure, bank earnings remain under pressure,
with Deutsche Bank <DBKGn.DE> reporting its first quarterly
loss in five years and fresh writedowns of 2.7 billion euros.
                                
 "In the first quarter of this year, the financial market
conditions were the most difficult in recent memory," chief
executive Josef Ackermann said in a statement.
                                
 "In the month of March, pressure on the banking sector was
more intense than at any time since the current credit downturn
began," he added. [ID:nL28449038]
                                
 BUYERS AT BAY
                                
 Speculation is high that the Fed will trim its funds rate
by a slim 25 basis points to 2.0 percent and signal a desire to
hold rates there for the time being. [nFEDAHEAD]
                                
 The nervous wait kept buyers at bay and Asian stocks
outside Japan <.MIAPJ0000PUS> slipped 0.3 percent by 0217 GMT.
Although the earnings season has frayed European and U.S.
nerves, strong quarterly result from Bank of China <3988.HK>
helped Hong Kong's Hang Seng index <.HSI> rise 1.1 percent to a
three-month high.
                                
 On Monday, the Dow Jones industrial average <.DJI> percent
slipped 0.16 percent as this year's biggest U.S. takeover bid
offset comments by influential investor Warren Buffett, one of
the deal's backers, that the country could face a long and deep
recession.
                                
 Buffett's Berkshire Hathaway <BRKa.N> will help finance
Mars Inc's $23 billion offer for Wm Wrigley Jr Co <WWY.N>, the
world's largest chewing gum maker. [ID:nN28496243]
                                
 The offer showed signs of life in the moribund U.S. merger
and acquisition market and underscored the notion that stocks
are relatively cheap.
                                
 PAULSON SEES "HEADWINDS"
                                
 Buffett also expressed wariness of a prolonged downturn.
                                
 "This is not a field of specialty for me, but my general
feeling is that the recession will be longer and deeper than
most people think," Buffett told CNBC television. "This will
not be short and shallow."
                                
 "I think consumers are feeling gas and food prices and not
feeling they've got a lot of money for other things," Buffett
said.
                                
 U.S. Treasury Secretary Henry Paulson said on Monday that
the economy was facing "headwinds" in the form of rising oil
prices and commodity costs <.CRB>, but insisted its long-term
economic fundamentals remained sound.
                                
 "I think there's a concern that supply is tight, could get
tighter and there's a potential for disruption down the road,"
he said.
                                
 OPEC President Chakib Khelil was quoted as saying oil could
go to $200 a barrel if the dollar kept falling. [ID:nL28112626]
                                
 U.S. crude oil futures <CLc1> hit a record high of $119.93
on Monday because of supply worries caused by attacks in
Nigeria and the closure of a British oil pipeline after a
refinery strike. The price trickled back to $118.30 in Asian
trade on Tuesday.
                                
 "The issues in Nigeria and North Sea are significant but
these outages tend to be overcome pretty quickly, so I think
the market is taking profit from record prices," said Mark
Pervan, a senior commodities analyst at the Australian & New
Zealand Bank.
 (Additional reporting by Geraldine Chua in SYDNEY and Fayen
Wong in PERTH; Editing by Lincoln Feast)