* Nikkei, Seoul shares lower as oil rises
* Dollar edges lower vs euro
* U.S. benchmark yields fall
By Gertrude Chavez-Dreyfuss
TOKYO, March 10 (Reuters) - Asian shares edged lower on
Thursday, weighed down by worries that a surge in oil prices
could exacerbate inflation pressures in the region and cripple
economic growth.
U.S. oil futures rose 0.3 percent, following a 2.5
percent jump in Brent oil late on Wednesday to $115.94 a
barrel. Oil advanced as fighting in Libya worsened and OPEC saw
no need for an emergency meeting to consider raising output.
Fears that Libya's uprising could spread further in the Middle
East also dented market sentiment.
"Tensions in the (Middle East) will ... remain on our radar.
We have reiterated the importance of Friday's Day of Rage in
Saudi Arabia," said Jessica Hoversen, currency strategist at MF
Global in Chicago.
The dollar has moved with swings in oil prices. Higher oil
prices tend to be negative for the greenback as the U.S. is a
major oil importer.
The surge in oil could hurt major economies like Japan, the
world's third largest. On Thursday, the Cabinet Office said
Japanese gross domestic product shrank a revised 0.3 percent in
the final quarter of 2010. [ID:nTKU000078}.
Analysts polled by Reuters expect Japan's economy to grow
0.5 percent in the current quarter on improved exports and
factory output. The economy is seen likely to continue growing
this year, but high oil prices pose a risk to the outlook.
Japan's Nikkei average fell as well, mainly pressured by the
weakness in U.S. stocks, with soaring oil a negative factor as
well. The benchmark Nikkei shed 0.4 percent, or 42.39
points to 10,547.11. The broader Topix index fell 0.3
percent to 941.16.
Seoul shares were also lower on Thursday, with technology
plays facing pressure after U.S. tech stocks fell on a weak
outlook from Texas Instruments. Investors were also wary of an
expected rate hike by the Bank of Korea later on Thursday.
Shares in Samsung Electronics and Hynix
Semiconductor both fell 1.5 percent.
The Korea Composite Stock Price Index (KOSPI) was
down 0.15 percent at 1,998.40 points.
U.S. Treasuries rallied on renewed fears of a debt crisis in
Europe after Portugal saw its cost for issuing two-year debt
soar to its highest level since it joined the euro in 1999. That
magnified fears that Portugal may need a bailout.
U.S. benchmark 10-year Treasury notes were
unchanged, following gains the previous session. The yield was
at 3.477 percent, down from 3.475 percent on Wednesday.
European debt fears also weighed on the euro, which was flat
against the dollar on Thursday, after hitting a four-month peak
on Monday. A European Union summit on Friday to discuss ways on
how to overhaul the euro zone economies also contributed to the
euro's pullback. In early Tokyo trading, the euro was little
changed at $1.3915 .
(Editing by Nick Macfie)
