Asian shares steadied in early trading on Friday after losses earlier in the week, but China jitters and global growth concerns weighed on investors' minds, while the dollar sat near a three-week high.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS recovered from early losses to trade flat, but was still down 2.7% on the week.
Hong Kong's Hang Seng Index .HSI rose 0.5% after posting its lowest close in 10 months the day before, as the saga around China Evergrande Group 3333.HK lurched towards a conclusion, unsettling investors.
The embattled property developer's shares dropped a further 5% on Friday.
Australian shares (xjo) fell 1.03%, as a fall in iron ore prices hurt miners. However, Chinese blue chips eked out a 0.26% rise and Japan's Nikkei .N225 edged up 0.42% to head back towards a 31-year high hit on Monday.
U.S. stock futures, the S&P 500 e-minis ESc1 , were down 0.6%.
"We're looking at a market that is nervous, though hasn't seen sentiment turn outright bearish," said Kyle Rodda, an analyst at IG markets.
"If you look for catalysts that could justify the next move to the upside in equities and risk assets, they are nowhere to be seen because global growth concerns are keeping investors on edge," he said.
Chinese data earlier this week suggested growth in the world's second-largest economy will slow in the second half of this year, while economists polled by Reuters said they expected the U.S. economic rebound to have been dented in Q3, partly on the spread of the Delta coronavirus variant.
While respondents pushed back expectations for the Federal Reserve to announce a tapering of asset purchases to November, a likely move this year provided little support for risk assets.
This also meant that strong U.S. retail sales data overnight, a reprieve after a series of underperforming data reads, did little to boost U.S. equities. Any rise in sentiment was outweighed by gains in both U.S. yields and the dollar which pressured market-leading tech stocks and weighed on exporters.
In Asia, the yield on benchmark 10-year Treasury notes US10YT=RR was 1.3378% compared with its U.S. close of 1.331%, and the dollar gained 0.04% against a basket of other majors =USD .
The Dow Jones Industrial Average .DJI fell 0.18%, the S&P 500 .SPX lost 0.16%, but the Nasdaq Composite .IXIC inched up or 0.13%, supported by Amazon.com Inc AMZN.O after the strong retail data read.
Gold recovered marginally on Friday with the spot price XAU= trading at $1,755.03 per ounce, up 0.2% after reaching a one month low on Thursday as higher yields hurt the non-interest bearing metal.
U.S. crude CLc1 dipped 0.22% to $72.45 a barrel. Brent crude LCOc1 fell 0.26% to $75.53 per barrel, but both are still hovering just below their highest levels since early August.
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