GLOBAL MARKETS-Stocks give up meagre gains as virus anxiety prevails

* Pandemic threatens sharp global slowdown
* Dollar braces for U.S. manufacturing data
* Oil market in confusion over supply glut

By Stanley White and Herbert Lash
TOKYO/NEW YORK, April 1 (Reuters) - Asian shares and Wall
Street futures fell on Wednesday in the first trading session of
the quarter as the coronavirus pandemic and the prospect of a
global recession tore through investor confidence.
E-Mini futures for the S&P 500 ESc1 slumped 2.27% as dire
predictions of more virus casualties in the United States
weighed on sentiment. MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS erased gains to trade 0.33% lower. Shares in
South Korea .KS11 , hit hard by the virus, fell 1.34%.
Japanese shares .N225 fell 3.48% as a rapid increase in
infections in Tokyo fuelled speculation the government would
place the capital on lockdown.
Futures in Europe were also battered with Euro Stoxx 50
futures STXEc1 down 2.99%, German DAX futures FDXc1 off
2.89% and FTSE futures FFIc1 falling 3.09%.
Wall Street tumbled on Tuesday, with the Dow registering its
biggest quarterly fall since 1987 and the S&P 500 its steepest
quarterly drop in a decade on growing evidence of the massive
downturn the pandemic will incur. L1N2BO2RR
U.S. economic activity is likely to be "very bad" and the
unemployment rate could rise above 10% because of efforts to
slow the spread of the coronavirus, Cleveland Federal Reserve
Bank President Loretta Mester told CNBC. L1N2BO2UT
"Investors still want to buy equities, but the coronavirus
is making everyone more cautious," said Kiyoshi Ishigane, chief
fund manager at Mitsubishi UFJ Kokusai Asset Management Co in
Tokyo.
"There are still a lot of risks out there, but if you can
identify individual shares with good dividend yields and strong
financials, then you can buy at a pretty good price."
There were some bright spots during Asian trading. Shares in
China .CSI300 , where the coronavirus first emerged late last
year, rose 0.74%, supported by hopes the world's second-largest
economy has started to recover.
China's factory activity improved in March after plunging a
month earlier, a private sector survey showed on Wednesday, just
scraping into positive territory and beating analysts'
expectations. Australian shares .AXJO jumped 3.58%, reversing Tuesday's
2% decline, as a slowdown in new coronavirus cases and rising
iron ore prices lifted the market.
MSCI's gauge of stocks across the globe .MIWD00000PUS fell
0.23%. The index slumped nearly 22% last quarter.
The number of coronavirus infections globally headed toward
800,000. In a positive development, Deutsche Bank analysts noted
the global growth in new cases was below 10% for two consecutive
days, having exceeded that rate for most of the past two weeks.
Health officials were not upbeat, however, with a World
Health Organization official warning that even in the
Asia-Pacific region, the epidemic was "far from over."
The dollar bounced in Asia but gave up gains to trade little
changed at 107.51 Japanese yen JPY=EBS as investors adjusted
positions before the release of U.S. manufacturing data.
The euro EUR=EBS was a tad lower at $1.1026 before data on
German manufacturing and the jobless rate in the European Union.
The dollar fell broadly on Tuesday after the U.S. Federal
Reserve said it would allow foreign central banks to exchange
their U.S. Treasury securities holdings for overnight dollar
loans to ease a dollar funding crunch. The yield on the benchmark 10-year U.S. Treasury note
US10YT=RR fell to 0.6301%.
U.S. crude CLc1 fell 1.42% to $20.19 a barrel. Brent crude
LCOc1 fell 2.81% to $25.61 per barrel as the United States,
Russia, and Saudi Arabia jostle over a massive oversupply of
oil.
Crude oil benchmarks ended a volatile quarter with their
biggest losses in history, with both U.S. and Brent futures
hammered throughout March due to the pandemic and the eruption
of a Saudi-Russia price war.
Global fuel demand has been cut sharply by travel
restrictions due to the coronavirus. Forecasters at major
merchants and banks see demand slumping by 20% to 30% in April,
and for weak consumption to linger for months.

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