Asian stocks pared declines on Friday but still rounded off a week of losses as persistent worries over whether the US economy may suffer another recession kept investors dour.
The cautious tone is expected to echo in European markets as well, with major stock indices opening lower by between 0.2 to 0.5 per cent.
Shaken by the recent run of poor US economic data, investors chose to play it safe and wait for a speech overnight by Federal Reserve chairman Ben Bernanke on how the world's biggest economy may fare in coming months.
Few expect Bernanke to suggest further monetary policy easing is on the cards to boost growth, even though some wish he would.
"What Bernanke says or doesn't say will determine our fate next week," said Don Williams, chief investment officer at Platypus Asset Management in Australia.
"Because of the sour state of the US economy, some are hopeful that there will be something on quantitative easing to support a recovery."
Underscoring the darkening US outlook, Friday's second estimate for US growth could show the economy grew 1.4 per cent last quarter, down from a first estimate of 2.4 per cent.
The overall uneasy mood hurt oil prices and held the US dollar near 15-year lows on the yen.
A report that Prime Minister Naoto Kan would hold a press conference later to talk about the strong yen stoked talk yet again that currency intervention from Tokyo was nigh.
That sparked a round of short-covering in Tokyo and pulled the Nikkei up 0.8 per cent, from 16-month lows.
But elsewhere, stocks struggled. The MSCI Asia stock index outside Japan trimmed an earlier 0.3 per cent fall and was flat by mid-afternoon.
Tech stocks were the biggest losers, in part because tepid US growth usually crimps demand for consumer electronics.
South Korea's Samsung Electronics, the world's biggest memory chip maker, lost 0.9 per cent. Hynix Semiconductor fell 0.2 per cent.
The MSCI Asia ex-Japan tech sub-index has ts, with the likes of Indonesia and Malaysia.
"Growth, growth, growth. That really is the theme," Mark Mobius at Templeton Asset Management, said of emerging markets.
"Whether it's selling automobiles to consumers in China, whether it's electricity supply to consumers, all of these areas are going to be most interesting."
Reuters