* MSCI Asia-Pacific index up 1 pct from 5-month low
* Markets expect ECB to offer easing bias; some see rate
cuts, other easing
* Investors hope U.S. payrolls data will confirm solid U.S.
* FTSE may rise 0.4 pct, DAX seen up 0.2 pct
By Hideyuki Sano
TOKYO, Feb 6 (Reuters) - Asian shares took a tentative step
forward from five-month lows on Thursday, with investors hoping
the European Central Bank (ECB) and upcoming U.S. jobs data can
calm nerves strained by the emerging market selloff.
MSCI's broadest index of Asia-Pacific shares outside Japan
gained 0.8 percent after five days of losses,
although Japan's Nikkei ended down 0.2 percent after a
Spread betters expect European shares to rise, with
Britain's FTSE seen rising by up to 0.4 percent and
Germany's DAX gaining by up to 0.2 percent.
While many players expect the ECB to stand pat at its
meeting later in the day, there is speculation it could ease its
policy further to ward off the threat of deflation following
last month's unexpectedly soft inflation reading.
With the bank's main interest rates already at 0.25 percent,
there is limited room for rate cuts, but that has not stopped
traders from betting on a small rate cut of about 10-15 basis
Others speculate the central bank could suspend so-called
sterilisation, or operations to soak up money put back in
circulation from the ECB's buying of government debt, or even a
large-scale quantitative easing.
At minimum, investors expect the ECB chief Mario Draghi to
at least drop hints of his readiness to ease, which could help
counter worries about dwindling stimulus from the U.S. Federal
"At the root of jolts in risk assets this year is the fact
that Fed is going ahead with tapering its stimulus. If the ECB
and the Bank of Japan are to ease, that would be positive for
risk assets," said Arihiro Nagata, head of foreign bond trading
at Sumitomo Mitsui Bank.
Expectations of a dovish tilt at the ECB capped the euro,
which traded little changed at $1.3535. Although it was
off a 10-week low of $1.34765 hit on Monday, it has not fully
recovered from the damage caused by surprisingly low inflation
reading released last Friday.
Relative calm in the markets of vulnerable emerging nations
Turkey, South Africa and Russia helped alleviate some of the
Many players are also looking ahead to the crucial U.S. jobs
report on Friday for a measure of comfort, although a
weaker-than-expected U.S. private jobs report promised to keep
investors on tenterhooks at least until the payrolls data is
"If the upcoming payrolls data shows solid job growth after
the dismal reading last month, we could confirm that the U.S.
growth trend has not changed. That will be a catalyst for
markets to stabilise," said Tohru Yamamoto, chief fixed-income
strategist at Daiwa Securities.
"But if it is weak again, it will break markets' heart."
Economists polled by Reuters expect the non-farm payrolls to
have increased 185,000 in January after a 74,000 gain in
"If the data comes in line with expectations, then most
investors will think they don't need to change their base
scenario on the U.S. economy," said Sumitomo Mitsui Bank's
Wall Street had a volatile session overnight, with the
benchmark S&P 500 hitting a 3 1/2-month intraday low of
1,737.92, before ending down 0.2 percent at 1,751.62.
Investors' cautious mood kept the safe-haven yen well bid,
with the Japanese currency not far from a 2 1/2-month high
against the dollar.
The dollar stood at 101.41 yen, still within sight of
a low of 100.755 yen touched on Tuesday.