Asian shares ease in thin holiday trade, U.S. market eyed

TOKYO (Reuters) - Asian shares eased on Tuesday as investors squared positions in thin volume before U.S. markets reopen after a long weekend and investors await fresh data that could offer clues about prospects for the world's largest economy.

MSCI's broadest index of Asia Pacific shares outside Japan <.MIAPJ0000PUS> slipped 0.3 percent. At this level, the index was set for a yearly loss of 17 percent, faring much better than a 50 percent plunge in 2008 when the collapse of Lehman Brothers roiled global financial markets.

But this year, the pan-Asian index has underperformed the pan-European FTSEurofirst 300 <.FTEU3> index of top shares, which so far is down 12 percent.

On Tuesday, Japan's Nikkei stock average <.N225> fell 0.4 in light trading. The benchmark was on track for a 17 percent decline this year. <.T>

European and some Asian markets, including Hong Kong and Australia, were closed on Tuesday.

"With U.S. and European players in holiday mood, there is no incentive except for year-end position adjustments," said Hirokazu Yuihama, senior strategist at Daiwa Capital Markets.

"The markets are in a lull now due to holidays, but concerns about the euro zone debt will resurface early next year, with the focus on refinancing needs facing Italy and Spain, and whether sovereign yields of these countries would shoot above levels considered unsustainable," he said.

Bank of Japan minutes for its November 15-16 meeting showed on Tuesday BOJ board members were worried that unstable global financial markets were affecting Japan's markets to some extent.

The euro was steady around $1.3060, staying well above its 11-month trough of $1.2945 hit earlier this month.

At this level, the single currency was set for a quarterly loss of 2.4 percent, narrowing the decline from 7.7 percent in the third quarter when the euro came under heavy selling as fears of Greek default intensified.

HOPES FOR THE U.S.

On Monday, when more markets were closed, Japanese and Indian stocks outperformed the rest of Asia in thin trade, with sentiment partly lifted by signs of U.S. economic recovery.

U.S. holiday season sales were expected to rise 3.8 percent to a record $469.1 billion, the National Retail Federation said, slower than last year's growth but stronger than its preseason forecast.

The potential brisk sales could reinforce emerging views that the U.S. economy is strengthening fundamentally, and follows recent data showing improvement the labout market. The number of Americans filing new claims for jobless benefits hit a 3-1/2-year low in the week shortly before Christmas while consumer sentiment reached a six-month high in December.

Investors will be looking for more positive signs when reports are released about the S&P Case-Shiller house price index for October and consumer confidence for December .

Sentiment has been underpinned by solid performances in U.S. equities, and strong data could help global markets end the year with a positive tone.

The broad Standard & Poor's 500 Index <.SPX> on Friday broke through its 200-day moving average after a four-day rally lifted stocks to bring the index into positive territory. The Dow Jones industrial average <.DJI> rose to its highest in five months, leaving it up 6 percent for the year.

(Editing by Richard Borsuk)

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