* Worries about China tightening, euro zone weigh on stocks
* Dollar keeps upward momentum, euro weak
* South Korean automakers rise on Toyota's woes
* MSCI Asia-Pacific stocks ex Japan near 3-mth low
(Repeats to more subscribers)
By Dean Yates
SINGAPORE, Feb 1 (Reuters) - Asian stocks fell to
three-month lows on Monday with investors cautious after new
data strengthened the case for tighter Chinese monetary policy
and as attention focused on key U.S. economic reports due this
week.
European shares <> were also expected to retreat by
as much as 1.2 percent amid lingering worries about Greece and
other weak euro zone members.
U.S. stock futures <SPc1> pointed to a slightly higher open
after Wall Street ended lower on Friday despite data showing
the U.S. economy grew at its fastest pace in six years in the
fourth quarter. []
Markets are bracing for a big week with a number of major
central bank meetings across the world and a raft of economic
reports out of the United States, culminating in the non-farm
payrolls data on Friday. [].
Many of Asia's stock markets lost ground on Monday, rattled
by U.S. losses last week, while Japan's Nikkei stock average
<> ended flat.
"A correction in Asia is healthy, definitely. Prices have
moved ahead quite well," said Alex Boggis, fund manager at
Aberdeen Asset Management, which oversees about $240 billion in
investments.
"Obviously over the last year markets have moved ahead
quite strongly based on ... a dramatically improving
environment. But has it really dramatically improved?"
Asia Pacific stocks outside Japan as measured by MSCI
<.MIAPJ0000PUS> were off 0.84 percent, a 3-month low. The index
lost 6.4 percent in January, its worst month in a year, after a
68 percent surge in 2009, as a host of unsettling factors
prompted investors to take profits.
According to data from Nomura, foreigners sold nearly $4.1
billion in stocks in six Asian markets ex-Japan in the week
ended Jan. 31 -- led by $1.7 billion in Taiwan, $1.2 billion in
India and $811 million in South Korea.
The U.S. dollar held at its highest levels in six months on
Monday, while the euro huddled near seven-month lows on euro
zone fiscal concerns, and higher yielding currencies remained
pressured by the closing of leveraged trades. []
Fresh worries over public finances of Greece, Portugal and
other smaller euro zone countries have also weighed on global
stocks. Fears that Athens will not be able to service its heavy
debt have prompted investors to shun riskier investments.
Also high on investor radar screens has been China, where a
pair of business surveys on Monday underlined the mounting
challenge policymakers face to curb inflation in the world's
third-largest economy. [] []
An index based on an official survey of purchasing managers
last month eased from a 20-month high in December but remained
firmly in expansionary territory, while an index derived from a
companion poll by HSBC scaled an all-time high.
"Industrial activity continues to accelerate, implying
stronger GDP growth in the first quarter. But rising input and
output prices also point to greater inflationary pressure,
which will likely prompt more tightening measures in the coming
months," said Qu Hongbin, chief economist for China at HSBC.
The Shanghai Composite Index <> fell 1.6 percent but
Hong Kong's Hang Seng index <> managed to recoup early
losses.
South Korean shares <> bucked the overall trend,
ending up 0.25 percent, with automakers posting strong gains on
firm January sales data and troubles at rival Toyota Motor Corp
<7203.T>, which has been hit by a massive recall of vehicles.
Hyundai Motor <005380.KS> ended up 2.65 percent, while Kia
Motors <000270.KS> closed 5.63 percent higher. Toyota, the
world's top automaker, fell 1.15 percent after losing almost 14
percent last week.
Toyota will announce on Monday details of its plan to fix
accelerator pedals that have led to the recall of 2.4 million
cars in the United States as it scrambles to put its worst
public relations crisis behind it.
The Australian dollar <AUD=> hovered at its weakest since
mid-December as investors unwound yen-funded carry trades on a
report that a UK regulator would like to restrain carry trading
generally.
The euro teetered at its lowest since last July, holding
just above $1.3850 <EUR=> where one trader reported talk of a
barrier yet to be triggered. It tested that level several
times.
U.S. Treasury bonds slipped but their losses were limited
as many investors held back ahead of key economic data and
events this week.
Before the jobs data on Friday, investors will get a
snapshot of U.S. manufacturing sentiment on Monday and
President Barack Obama will also make remarks on the U.S.
budget at 1545 GMT.
The benchmark 10-year notes <US10YT=RR> edged down 5/32 in
price to yield 3.609 percent, up about 2 basis points from late
New York trade on Friday. T-note futures were unchanged at
118-05/32 <TYv1>.
Oil prices <CLc1> steadied below $73 a barrel on Monday,
pausing from the previous session's 1 percent decline which
came as concerns about sluggish energy demand outweighed
stronger-than-expected U.S. economic data.
NYMEX crude for March delivery <CLc1> edged lower to $72.75
a barrel by 0645 GMT.
(Editing by Kim Coghill)
