Asian markets fall after rally, weak China data

Asian markets were lower on Friday as traders took a breather after healthy gains in the previous session while Chinese data showed growth in manufacturing activity had slowed.

Wall Street provided a meek lead, with the Dow ending lower after flirting with a record high as investors appeared to take in their stride looming deep US budget cuts due to take effect later in the day.

Tokyo eased 0.22 percent, Hong Kong fell 0.29 percent, Sydney was off 0.40 percent and Shanghai was 0.13 percent lower. Seoul was closed for a holiday.

China's official purchasing managers' index (PMI) showed activity in the crucial manufacturing sector eased to 50.1 last month from 50.4 in January. A reading above 50 indicates growth.

The figures follow HSBC's preliminary data earlier this week of 50.4, down from 52.3 in January, and suggest the recent pick-up in the world's number two economy is weaker than initially thought. HSBC's final figures will be released later Friday.

Shares in the United States ended lower, with the Dow seeing a late sell-off after moving within a few points of its record high seen just before the onset of the global financial crisis.

Traders were left unimpressed by a revision of fourth-quarter US economic growth, which came in at a lower-than-forecast 0.1 percent, although it was better than the 0.1 percent contraction previously estimated.

There seemed to be little reaction to the fact that the government was poised to start slashing spending Friday as the $85 billion in federal cuts known as the "sequester" comes in, which economists say will trim growth.

The Dow ended 0.15 percent lower, while the S&P 500 lost 0.09 percent and the Nasdaq edged down 0.07 percent.

Currency markets were quiet in early trade after a volatile week, which saw the dollar and euro surge against the yen before tumbling in reaction to Italian elections that renewed concerns about the eurozone.

In Tokyo the dollar bought 92.60 yen, compared with 92.58 yen in New York Thursday afternoon. The euro fetched 121.03 yen and $1.3069 compared with 120.95 yen and $1.3062.

Oil prices eased, with New York's main contract, light sweet crude for delivery in April, shedding 45 cents to $91.60 a barrel and Brent North Sea crude for April delivery sliding 43 cents to $110.95.

Gold was at $1,582.70 at 0230 GMT compared with $1,591.00 late Thursday.