MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.1 percent after climbing 1 percent the previous day. Japan's Nikkei, which surged 2 percent on Wednesday, dropped 0.5 percent. South Korean and Australian stocks were also lower. Investors also became more risk-averse as an extended rally in crude oil petered out. Wall Street snapped a two-day surge overnight, weighed by a slide in energy shares. Crude oil plunged overnight in one of its biggest daily falls ever as record high U.S. oil inventories ended a four-day rally. In a "dead cat bounce" U.S. crude was last up 0.7 percent at $48.79 a barrel after sinking 9 percent on Wednesday.
Asian stocks and the euro handed back gains and slipped on Thursday after the European Central Bank took a hard line stance on Greece's debt and dampened optimism towards a resolution to the saga. Risk appetite, which had warmed earlier in the week on hopes that Greece would gain relief from its creditors, took a hit after the ECB pulled back its soft treatment of Greek debt and cancelled its acceptance of the country's bonds in return for funding. The ECB heaped pressure on Greece’s new government by restricting access to direct liquidity lines, citing concerns about the country’s commitment to existing bailout pledges.
A monetary easing move by China late on Wednesday in an attempt to energize its sputtering economy failed to lift the cheerless mood in the region's equity markets. In currencies, the euro traded at $1.1341, having fallen as far as $1.1315. It has completely reversed a short-covering rally that lifted it to $1.1534 on Tuesday. The dollar was little changed at 117.29 yen, with the market awaiting the U.S. employment-related data later in the session as a preview to Friday's all important non-farm payrolls.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery rose 0.09%, to $1,270.30. Also on the Comex, silver futures for March delivery gained 0.24% to trade at $17.392 a troy ounce. Silver rose 7.0 cents, or 0.41%, to end at $17.32 on Tuesday. Elsewhere in metals trading, copper for March delivery eased 0.01% to trade at $2.590 a pound. Overnight, gold hit the highest levels of the session on Wednesday, after data showed that U.S. non-farm private employment rose less-than-expected in January and after China's central bank cut banks' reserve requirement ratios in a surprise decision.