By Shinichi Saoshiro
TOKYO (Reuters) - Asian stock markets started the week on a subdued note on Monday, as tensions in Ukraine kept investors cautious amid the absence of catalysts as several markets remained closed for Easter holiday.
MSCI's broadest index of Asia-Pacific shares outside Japan inched down 0.1 percent.
Japan's Nikkei stock average, one of the few major stock markets that traded on Friday, edged up 0.5 percent.
Global markets have been buffeted in recent weeks by tensions in Ukraine, signs of slowing growth in China and uncertainty over when the U.S. Federal Reserve would start to tighten interest rates.
Fed Chair Janet Yellen's dovish comments last week helped soothe market nerves.
The dollar edged up to a two-week high against the yen after data showed Japan posting its largest ever trade deficit in the year through March 2014.
The dollar rose to 102.63 yen, it's highest point since April 8, and remained well bid after upbeat U.S. factory data and jobless claims late last week.
Analysts said signs that the U.S. economy had shaken off disruptions caused by harsh winter weather would help the U.S. currency in the longer run.
"With momentum building behind the U.S. industrial cycle, tentative signs of wage-based pressure building, and further labour market improvements likely, falling U.S. rates are unlikely to continue to be a major driver of dollar weakness," strategists at Barclays said in a note to clients.
The encouraging U.S. data saw the 10-year U.S. Treasury note yield spike on Friday to a 10-day peak of 2.726 percent, pulling back sharply from a six-week trough of 2.596 percent hit earlier last week.
Support for the safe-haven Japanese currency also ebbed last week after the United States, Russia, Ukraine and the European Union called for an immediate halt to violence.
However, a tensions in Ukraine is expected to underpin the yen in the short term, traders said.
At least three people were killed in a gunfight in the early hours of Sunday near a Ukrainian city controlled by pro-Russian separatists, shaking an already fragile international accord that was designed to avert a wider conflict.
The euro at $1.3812, little changed from last week. It hit a 2-1/2-year high near $1.40 in the middle of March, but has since gone on the defensive after a number of European Central Bank officials have expressed concerns about the common currency's strength.
(Editing by Shri Navaratnam)
- UK International News