In This Article:
* Worries about U.S.-China collision keep investor on edge
* Euro little changed after ECB ends QE but keeps reinvestments
* Oil up on U.S. inventory, hopes of tighter supply
By Hideyuki Sano
TOKYO, Dec 14 (Reuters) - Asian shares were on the defensive on Friday as investors kept a wary eye on economic tensions between Washington and Beijing while the euro was steady after the European Central Bank halted new bond purchases as expected.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.3 percent while Japan's Nikkei dropped 0.4 percent.
On Wall Street, the S&P 500 ticked down 0.02 percent to 2,650, not far from its 6-1/2-month closing low of 2,633 touched on Nov 23, while the Nasdaq Composite dropped 0.39 percent.
"If U.S. shares fall below their triple bottoms hit recently, that would be a very weak technical sign," said Nobuhiko Kuramochi, chief strategist at Mizuho Securities.
U.S. corporate earnings due next month could throw a spotlight on the impact from the U.S. tariffs on imports from China, while there is risk of a government shutdown and further political stalemate in a divided U.S. congress, he said.
"Although hopes of progress in U.S.-China talks and cheap valuations are supporting the market for now, we have lots of potential pitfalls," Kuramochi added.
A Chinese commerce ministry spokesman said on Thursday China and the United States are in close contact over trade and that any U.S. trade delegation would be welcome to visit.
But that has hardly dispelled concerns about a broadening confrontation between the two economic heavyweights.
China said on Thursday a Canadian businessman is being investigated on suspicion of harming China's security, days after a former Canadian diplomat was detained in an escalating diplomatic row.
The moves are seen as a reaction to Canada's arrest on Dec. 1 of Chinese executive Meng Wanzhou, the chief financial officer of Huawei Technologies, for extradition to the United States. .
The euro changed hands at $1.1362, stuck in its well-worn $1.13-$1.14 range over the past few days.
The ECB ended its 2.6 trillion euro crisis-fighting bond purchase scheme but pledged to continue reinvesting maturing bonds - thereby avoiding shrinking its balance sheet - for an extended period of time.
The plan lifted Portuguese and Irish government bond prices sharply on Thursday.
Sterling's rally fizzled as signs that the British parliament was headed towards a deadlock over Brexit prompted traders to take profits from its gains made after Prime Minister Theresa May had survived a no-confidence vote.