GLOBAL MARKETS-Asian shares set for rough ride on virus fears, China in focus

* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* Australian, NZ shares fall; oil slides, gold firm
* Coronavirus death toll in China rises to 350
* China cbank to inject $174 bln liquidity on Monday
* Economists lower growth forecasts for Chinese economy

By Swati Pandey
SYDNEY, Feb 3 (Reuters) - Asian markets are set for another
bumpy ride on Monday on fears about the hit to world growth from
the rapidly spreading coronavirus, with all eyes on China where
trading resumes following the Lunar New Year break.
A total of 350 people have died in China from the new virus
with the first death out of the mainland reported on Sunday in
the Philippines. Looking to head off a panic, China's central bank plans to
inject 1.2 trillion yuan ($173.8 billion) of liquidity into the
markets via reverse repo operations on Monday. Beijing also said it would help firms that produce vital
goods resume work as soon as possible, state broadcaster CCTV
reported. Despite the measures, Australia's benchmark index .AXJO
opened in the red to be down 0.7% while New Zealand shares
.NZ50 faltered 1.8%. Futures for Japan's Nikkei NKc1 were
slightly higher but still about 500 points below where the index
closed on Friday.
"These initial interventions aim to boost confidence, but
they are unlikely to be sufficient to curtail a sharp downturn
in Q1," Citi economists said in a note.
"As most employees won't return to work until Feb. 9, the
output losses are likely to be larger than expected, and
incoming economic activity data will continue to prompt the
authorities to take more actions in order to reduce the adverse
impact of the Wuhan coronavirus on the economy."
For Chris Weston, a Sydney-based strategist at broker
Pepperston, "the big unknown" was how China's financial markets
respond to the show of force from the country's central bank.
"The fact the China Securities Regulatory Commission (CSRC)
has detailed they see the impact of the coronavirus as
'short-lived' is designed to instil confidence," Weston said.
"Whether the market feeds off this optimism is another thing
given the spread of the virus is still in its exponential
stage."
Economists tempered their outlook for the world's
second-largest economy, as travel curbs and supply chains
disruptions are likely to crimp Chinese growth. Citi revised its full-year forecast for China's GDP growth
to 5.5% in 2020 from 5.8%. It also cut first-quarter growth
expectations to 4.8% from 6% in the fourth quarter of 2019.
JPMorgan shaved its forecast for global growth by 0.3
percentage point for this quarter.
Data out of the United States and Europe on Friday too
pointed to economic weakness while a mixed batch of corporate
earnings added to the gloom.
Monday's decline in Asian equities follows a steep sell-off
in global share markets, which, on Friday, posted their biggest
weekly and monthly declines amid growing concerns about the
economic impact of the coronavirus outbreak in China.
MKTS/GLOB
On Friday, the Dow .DJI fell 2.1%, the S&P 500 .SPX
declined 1.8% and the Nasdaq Composite .IXIC dropped 1.6%.
Indicating a stable start for U.S. shares, E-Mini futures
for the S&P500 ESc1 opened a tad higher on Monday.
The safe-haven Japanese yen JPY= held near a 3-1/2 week
high after adding about 1.5% in the last two weeks. The risk
sensitive Australian dollar AUD=D3 , which is often traded as a
liquid proxy for the Chinese yuan, tumbled 2% last week to hit a
four-month trough.
Gold, which posted its best month in five in January, was
last up 0.1% at $1,591.26 while yields on U.S. debt lingered
near five-month lows as the United States, Japan and other
countries tightened travel curbs to China, where the death toll
from the virus rose to 213.
Oil futures were down on worries about a slowdown in demand
with Brent crude LCOc1 sliding 39 cents to $56.24 a barrel,
the lowest since January 2019.

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(Editing by Sam Holmes)