LONDON: World shares eased and the safe-haven Japanese yen hit fresh highs on Tuesday after a rebound in China's factory sector and a big rate cut in Australia failed to offset concerns about the U.S. economy and the euro zone in thin holiday trading.
The stronger yen also helped send Japan's stock market to a 2-1/2 month closing low while the MSCI's world equity index <.MIWD00000PUS> was down just 0.15 percent to 328.26, adding to losses of about 1.5 percent in April.
"In general stock markets and risk assets seem to be extremely resilient in the face of the news flow which has undoubtedly been in the more negative nature," James Ferguson, strategist at Westhouse Securities said.
Most markets in Asia and Europe were closed on Tuesday to mark the May Day holiday and activity could remain limited ahead of Thursday's monthly policy meeting of the European Central Bank and Friday's release on U.S. non-farm payrolls data.
The yen hit a two-month high of 79.64 yen against the dollar with demand fueled by narrowing yield differentials to other major markets.
The Reserve Bank of Australia cut interest rates by a surprisingly aggressive half a point to 3.75 percent, a level not seen since late 2009, and left the door open for further easing if needed.
In commodity markets signs of a gradual recovery in China countered the rise in worries about the health of the U.S. economy leaving Brent crude steady above $119 a barrel and copper trading near $8,400 a metric tonne (1.1 ton).