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 An indifferent session on Wall Street and a mixed run of U.S.
corporate earnings sapped the energy from stocks. MSCI's broadest
index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> dipped
0.2 percent, while Australia's main index <.AXJO> lost 0.4 percent.
The Dow <.DJI> ended Wednesday down 0.25 percent, while the S&P 500
<.SPX> added 0.06 percent and the Nasdaq <.IXIC> 0.41 percent.
IBM missed revenue expectations for a fourth straight quarter,
driving down shares of the world's largest technology services
company by nearly 4 percent, making them the biggest drag on the
market.
Attention in Asia was on the HSBC China flash PMI for January at
0145 GMT, which will give an early hint on the health of its massive
manufacturing sector.
The December survey disappointed with a reading of 50.5 and any
further dip would be taken badly by markets.
Investors seem to have a "glass half empty" view of the Asian giant
these days which is why a better-than-expected reading on economic
growth released earlier in the week caused only a fleeting rally in
markets.
Later Thursday, Europe has its own version of early PMIs along with
a round of unemployment figures.
The Eurozone composite PMI is seen edging up to 52.4 in January,
from 52.1, led mostly by strength in Germany while France could
again lag behind.
In currencies, it was all about central bank expectations. Sterling
surged after a sharp fall in UK unemployment stoked speculation the
Bank of England would have to bring forward the day when it started
hiking interest rates.
The euro duly fell to a one-year low against sterling of 81.81
pence, while the pound jumped over a cent on the U.S. dollar.
Across the pond, the Canadian dollar tumbled to a more than
four-year low after the Bank of Canada said it was growing more
concerned about low inflation, leaving the door wide open to a cut
in interest rates.
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The central bank also took a rhetorical razor to the Canadian dollar
saying a weaker currency would be positive for both exports and
inflation.
The stark contrast with the situation in the UK, saw the pound soar
1.8 percent on the Canadian currency to the highest since mid-2009.
The U.S. dollar found some support from expectations the Federal
Reserve will make another $10 billion cut to its monthly bond-buying
program at its policy meeting next week.
The dollar was modestly firmer on the yen at 104.54, while the euro
marked time at $1.3546.
In commodity markets, freezing temperatures in the U.S. Northeast
drove up prices for natural gas and oil.
U.S. crude oil futures were at $96.63 a barrel early Thursday after
jumping more than a dollar overnight. Brent oil for March delivery
had ended up $1.35 at $108.08.
Gold lost ground after its repeated failure to break above key
technical resistance at $1,260 an ounce prompted investors to take
profits. Spot gold was off at $1,237.21 per ounce, leaving behind
Monday's peak of $1,259.85.
(Editing by Richard Pullin)
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