On Thursday, Asian shares gave back earlier gains after data suggested that the factory activity of China shrank for a fifth successive month, underscoring concerns about a growth slowdown in the world's second largest economy.
The MSCI Asia Pacific ex-Japan index .MIAPJ0000PUS fell sharply from a 0.6 percent gain before the Chinese data. After opening lower, Japan's Nikkei average .N225 gained 0.4 percent. The earliest indicator of China's industrial activity, the HSBC flash PMI, fell to 48.1 in March from February's four-month high of 49.6, with new orders sinking to a four-month low while the Australian dollar fell below $1.040 after the data.
"Growth momentum could slow down further amid a combination of sluggish export new orders and softening domestic demand. This calls for further easing steps from the Beijing authorities," HSBC chief China economist Qu Hongbin said in a statement.
"During Asian hours, key market drivers are Japan's trade data and China's PMI," said Yuji Saito, director of the foreign exchange division at Credit Agricole Bank in Tokyo. "Otherwise, markets will likely continue to consolidate and are more likely to be affected by quarter-end supply and demand flows than headline news."
Brent oil fell 0.4 percent to $123.71 a barrel while U.S. crude futures eased 0.7 percent to $106.52 a barrel and the euro was steady at $1.3219, off a two-week high of $1.3286 reached on Wednesday.