HONG KONG: Asian markets were mixed on Thursday as positive Chinese manufacturing data was tempered by comments on the US economy by Federal Reserve chief Ben Bernanke.
The euro extended gains against the major currencies after a record take-up of cheap loans from the European Central Bank by cash-strapped lenders, while Japanese exporters benefited from the yen's continued weakening.
Tokyo was 0.14 percent lower by the break, Hong Kong shed 0.58 percent, Sydney lost 0.69 percent, Seoul jumped 1.33 percent and Shanghai added 0.10 percent.
Data out of Beijing showed manufacturing activity expanded for the third straight month in February as exports picked up, easing concerns the world's number two economy was slowing down too quickly.
The official purchasing managers index rose to 51 in February from 50.5 in January, with most sectors showing signs of improvement, the China Federation of Logistics and Purchasing said in a statement.
A reading above 50 indicates industry is expanding.
Markets had been growing increasingly concerned over manufacturing in China, which began shrinking at the end of last year as key export markets, especially the European Union, struggle.
While the upbeat outlook for China provided some confidence, Bernanke's cool assessment of the US economy injected caution into the market.
The Fed chairman told a congressional hearing that flat incomes and still-high unemployment would likely limit growth this year to 2.25 percent, dampening recent bullishness on the economy following a string of positive data.
"Bernanke's comments failed to inspire markets," Melbourne-based Chris Gore, a currency analyst at Go Markets, said in a note, according to Dow Jones Newswires.
"His economic assessment was far from encouraging and his comments provided little inspiration for those betting on another round of quantitative easing," Gore said, referring to the central bank's policy of flooding markets with cash to boost liquidity.
The dollar, which has rallied against the yen in the past two weeks, gained further on the news. In early Tokyo trade it bought 81.18 yen against 81.12 yen in New York late Wednesday.
The euro was also stronger as dealers welcomed the second ECB liquidity exercise for banks, this time worth nearly 530 billion euros and easing pressure on weak eurozone member states' borrowing costs.
Wednesday's operation, the second after one in December, immediately lifted the euro to $1.3466 before it fell back sharply to end in New York at $1.3325.
In Tokyo the common currency fetched $1.3340, while it also gained to 108.28 yen, compared with 108.11 yen in New York.
The weakening yen -- which dealers have also been selling since Tokyo announced another round of monetary easing in February -- also lifted exporters, with Toyota Motor up 0.59 percent and Sony 1.03 percent higher.
Elpida Memory rose 14.3 percent in the morning session after diving 97.2 percent on Wednesday when the Tokyo bourse removed trading restrictions following the microchip maker's bankruptcy filing.
New York's main oil contract, West Texas Intermediate crude for April delivery, gained 11 cents to $107.18 per barrel and Brent North Sea crude for April was up 34 cents at $123.00.
Gold was at $1,717.05 an ounce at 0215 GMT, compared with $1,788.20 late Wednesday.
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