Asia subdued before oil producers' meeting, China GDP taken in stride

By Shinichi Saoshiro

TOKYO (Reuters) - Asian stocks were subdued on Friday as caution over a weekend meeting of oil producers tempered risk sentiment, while the region's markets took China's relatively upbeat GDP data in stride as the numbers were in line with expectations.

Spreadbetters forecast a slightly lower open for Britain's FTSE (FTSE), Germany's DAX (GDAXI) and France's CAC (FCHI).

Japan's Nikkei (N225) was down 0.3 percent and Australian stocks edged up 0.5 percent (AXJO).

Shanghai <.SSEC> lost 0.3 percent, while South Korea's Kospi (KS11) inched down 0.2 percent.

China's economy grew 6.7 percent in the first quarter from a year earlier, and while this was the slowest since 2009, it met expectations and provided additional evidence that a slowdown there may be bottoming out.

"All this obsession with a Chinese hard-landing I think is a bit too much. Chinese economic data is showing signs of stabilisation, including recent PMI numbers, as well as the latest figures on industrial production and retail sales," said Suan Teck Kin, economist at the United Overseas Bank in Singapore.

MSCI's broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) crept up 0.1 percent. The index has gained about 3.6 percent on the week during which it hit a five-month high, helped by a slight thaw in pessimism over the Chinese economy and an earlier surge in crude oil prices.

Stocks have gained globally this week against this backdrop, with the S&P 500 (SPX) reaching its highest point so far this year overnight, and taking it a step closer to record highs scaled almost a year ago.

"There are a lot who doubt the current market rally at the moment, particularly when the S&P 500 is so close to its all-time highs," wrote Angus Nicholson, market analyst at IG in Melbourne.

"And yet, in a world where one-third of government bonds have negative yields, there is a strong incentive to increase one's equity allocation in pursuit of positive returns."

Oil prices have pulled back from recent peaks on concerns that the top producers' meeting may not result in a tightening of supply. [O/R]

U.S. crude oil (CLc1) was up 6 cents at $41.56 a barrel, but still off a 4-1/2-month peak above $42 reached mid-week when market hopes were higher that the Doha producers' meeting would result in tighter supply. Brent crude rose 5 cents to $43.89 a barrel (LCOc1).

The dollar, which had gained broadly this week as risk appetite improved, stalled against the euro after Thursday's data showed U.S. consumer prices rose less than expected in March.

The euro traded little changed at $1.1257 , nudged away from a two-week low of $1.1234 plumbed earlier on Thursday.

The dollar fared better against its the yen, touching a one-week high of 109.74 yen. The greenback has consolidated for now after falling to a near 18-month trough of 107.63 on Monday.

Sterling was steady at $1.4155 , moving away from an overnight low of $1.4091 after Bank of England policymakers voted 9-0 to keep interest rates at a record low of 0.5 percent, quashing speculation that one or more members could vote to cut rates.

The pound was also pressured earlier on Thursday after a YouGov poll was the latest to show Britain split down the middle before the June 23 referendum on whether to leave the European Union.

The Australian dollar, buoyant through much of the week thanks to a bounce in commodities, stepped back from a nine-month peak of $0.7737 reached overnight and last traded at $0.7714 .

The Aussie, often used as a proxy of China-related trades, showed little reaction to Friday's Chinese GDP numbers.

The forex market awaited the outcome of a Group of 20 meeting in Washington which was seen likely to discuss currency policies.