With no lead from the US which had been closed for a holiday, investors waited for the ECB meeting later in the day, as well as for an expected announcement of $78 billion in fresh stimulus cash from the Bank of England.
After holding steady in Asia, the euro slipped back against the dollar in early European trade, and markets in Europe opened up ahead of the key ECB and BoE meetings.
Tokyo closed 0.27 percent, or 24.37 points, lower at 9,079.80, and Seoul was flat, rising 0.06 percent, or 1.04 points, to close at 1,875.49.
Hong Kong closed 0.50 percent, or 99.38 points, higher at 19,809.13, but Shanghai slipped 1.17 percent, or 25.97 points, to 2,201.35 amid continued concerns about China’s slowing economic growth.
Sydney was flat, giving up 0.07 percent, or 3.0 points, to close at 4,169.2.
Herald van der Linde, head of equity strategy Asia-Pacific at HSBC in Hong Kong, told Dow Jones Newswires markets were “taking a bit of a breather” after gains on last week’s EU summit deal to help the eurozone.
He added the ECB’s expected rate cut was not affecting regional bourses as “the market has already priced in a cut”.
Investors were also holding back ahead of key jobs data in the US to be released on Friday, betting the figures will be poor and may push the US Federal Reserve towards a new round of quantitative easing, dealers said.
The ECB is widely expected to trim eurozone borrowing costs later Thursday by a quarter of a percentage point to a new record low of 0.75 percent, central bank watchers predicted.
It is hoped the move will build on the progress made by European leaders last week, whose surprise agreement to help the embattled single currency has lifted markets.
The leaders agreed emergency measures, which included using rescue funds to directly recapitalise ailing banks as well as $150 billion in new stimulus, to help the eurozone whose debt crisis is threatening the world economy.
But with the rate cut now factored in, some analysts argued there could be disappointment without additional measures from the bank, such as the resumption of its bond-buying programme which has lain dormant for 16 weeks.
“We expect the ECB to cut its main interest rate by 25 basis points to 0.75 percent,” said Berenberg Bank economist Christian Schulz, warning that such a move alone “would probably disappoint markets”.
On currency markets in early European trade, the single currency slid to $1.2512 from $1.2527 late Thursday in New York.
On oil markets, New York’s main contract, light sweet crude for delivery in August shed 83 cents to $86.83 a barrel while Brent North Sea crude for August delivery slipped 32 cents to $99.45.
Gold was at $1,618.30 at 1115 GMT, compared with $1,616.50 late Wednesday.
In other markets:
– Taipei fell 0.47 percent, or 34.81 points, to 7,387.78.
Smartphone maker HTC shed 4.9 percent to Tw$339.5 while Taiwan Semiconductor Manufacturing Co. was 0.25 percent lower at Tw$81.0.
– Wellington edged up 0.03 percent, or 1.08 points, to 3,484.20.
Air New Zealand rose 0.55 percent to NZ$0.915, Telecom Corp. fell 0.2 percent to NZ$2.49 and Fletcher Building was off 0.64 percent at NZ$6.22.
– Manila closed up 0.29 percent, or 15.26 points, at 5,369.98.
SM Investments Corp. gained 0.50 percent to 742 pesos while Megaworld Corp. rose 0.01 percent to 2.29 pesos.
– Singapore closed 0.77 percent, or 22.70 points, higher at 2,971.47.
United Overseas Bank advanced 1.20 percent to Sg$19.38 and Fraser and Neave gained 1.96 percent to Sg$7.30.
– Kuala Lumpur rose 0.04 percent, or 0.68 points, to 1,614.43.
Telecommunications company Axiata Group gained 0.36 percent to 5.55 ringgit, while budget carrier AirAsia added 1.35 percent to 3.75.
– Jakarta fell 0.15 percent, or 6.08 points, to 4,069.84.
Aneka Tambang slipped 1.41 percent to 1,400 rupiah, Astra Agro Lestari slid 0.45 percent to 22,200 rupiah and Indocement slid 0.53 percent to 18,800 rupiah.
– Bangkok rose 0.64 percent, or 7.65 points, to 1,201.80.
Banpu was unchanged at 468 baht, while PTT gained 0.60 percent to 338 baht.
– Mumbai added 0.43 percent, or 75.86 points, to 17,538.67, a three month closing high.
India’s largest private bank ICICI Bank rose 2.04 percent to 920.9 rupees while leading vehicle maker Tata Motors advanced 1.61 percent to 240.
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