GLOBAL MARKETS-Asian shares hit 2-week lows, dollar gains as investors scurry for cover

* MSCI ex-Japan falls for second day in a row, down 1.3%
* U.S. dollar edges to near 4-month highs
* European stocks set for weaker open
* Investors worried about coronavirus lockdowns in Europe
* Oil steadies after hefty losses on Tuesday, gold shines

By Swati Pandey
SYDNEY, March 24 (Reuters) - Asian shares skidded to a
two-week trough on Wednesday and the dollar neared four-month
highs as coronavirus lockdowns in Europe and potential U.S. tax
hikes hit risk appetite, leading to a flight to safety.
U.S. and European stock futures were weaker in late Asian
trading. E-Mini futures for the S&P 500 ESc1 were down 0.1%,
London's FTSE futures FFIc1 were 0.65% lower while eurostoxx
50 futures STXEc1 lost 0.6%.
MSCI's broadest index of Asia-Pacific shares outside of
Japan .MIAPJ0000PUS fell 1.3% after losing 0.9% on Tuesday. It
went as low as 674.18 points, a level last seen on March 9.
The index has had a disappointing run in March after five
straight months of gains, as risk assets were earlier spooked by
fears inflation will pick up at a faster-than-expected pace led
by successful coronavirus vaccine rollouts and massive U.S.
fiscal stimulus.
Japan's Nikkei stumbled 2% .N225 while South Korea's KOSPI
.KS11 slipped 0.4%. Chinese shares were in the red for a
second day with the blue-chip CSI300 index .CSI300 down 1.65%.
Hong Kong's Hang Seng .HSI skidded 2.2%.
On Wall Street overnight, the Dow Jones Industrial Average
.DJI fell 0.94%, the S&P 500 .SPX lost 0.76% and the Nasdaq
Composite .IXIC dropped 1.12%.
"We continue to stress that the economic outlook remains
tied to the path of the virus," said Kim Mundy, senior economist
& currency strategist at Commonwealth Bank.
"The risk is that the more contagious and deadly strain of
the virus elicits a stronger response from European governments
which sees Europe remaining locked down for longer."
Germany extended its lockdown to April 18. A U.S. health
agency said the AstraZeneca (NASDAQ:AZN) Plc AZN.L vaccine developed with
Oxford University may have included outdated information in its
data, further fueling investor concerns over the recovery.
Adding to investor woes, Treasury Secretary Janet Yellen
told Congress on Tuesday the U.S. economy remained at risk.
In currencies, the dollar index approached a four-month top
of 92.506 against a basket of most major currencies. =USD
FRX/
The euro EUR= edged toward a four-month trough below
$1.18355 - trading as low as $1.18360 - after Germany extended
its lockdown. The safe-haven yen JPY= was broadly stronger,
and Australia's dollar AUD= - considered a liquid proxy for
risk - slipped as low as $0.7583, a level not seen since Feb.5.
U.S. manufacturing data was due later on Wednesday and
Powell was expected to give the same prepared testimony to a
Senate banking panel. The flight to safety hit commodity prices, though oil prices
edged higher on Wednesday as investors looked for bargains.
Gains were capped, however, as lockdowns in Europe and a build
in U.S. crude stocks curbed risk appetite and raised oversupply
fears. O/R
Brent crude futures LCOc1 rose 22 cents to $61.01 a
barrel, after tumbling 5.9% and hitting a low of $60.50 on
Tuesday. West Texas Intermediate (WTI) crude futures CLc1
added 17 cents to $57.93, having lost 6.2% the previous day.
Safe haven gold was higher at $1,729.3 an ounce.