Asia stocks waver, China manufacturing sluggish

Asian stock markets wobbled on Wednesday, while the dollar took back some ground after the latest reading on China's manufacturing activity showed activity slowed to an 11-month low in July as new orders faltered and the job market darkened.
European markets could shrug off the impact of the downbeat China data if German and French manufacturing and services PMI surveys show a slight improvement as expected.
The flash HSBC/Markit Purchasing Managers' Index for China fell to 47.7 this month from June's final reading of 48.2, marking a third straight month below the 50 threshold between expansion and contraction.
"The lower reading of the July HSBC Flash China Manufacturing PMI suggests a continuous slowdown in manufacturing thanks to weaker new orders and faster destocking," said Hongbin Qu, chief China economist of HSBC.
"This adds more pressure on the labour market," he said.
Worries of a rapid slowdown in the world's second-biggest economy as well as expectations that the U.S. Federal Reserve will begin to trim its massive bond-buying stimulus later this year have rattled global markets in recent weeks.
MSCI's broadest index of Asia-Pacific shares outside Japan pared an earlier rise to its highest since June 7, and was last up about 0.1%.
China shares were headed for their first loss in three days after the data, weighing on Hong Kong markets. The Shanghai Composite Index slid 0.8%, while Hong Kong's Hang Seng Index edged down 0.1%.
Japan's Nikkei share average ended down 0.3%, giving back some of its two-day rally, after government data showed the country's export growth unexpectedly slowed in June from a year earlier. The figures were a worrying sign that China's slowing economy hurt overseas demand and could potentially threaten Japan's economic recovery.
In U.S. trading on Tuesday, the S&P 500 snapped a four-session winning streak and retreated from Monday's record closing high, while upbeat results from United Technologies bolstered the Dow, which also touched a record intraday high.
The Australian dollar also erased its early gains against its U.S. counterpart and skidded after the China data, tumbling 0.5% to $0.9251.
Tame inflation data left the door open for the Reserve Bank of Australia to cut interest rates next month if it chooses, though key measures of underlying inflation were a touch higher than expected.
Yields on U.S. benchmark 10-year Treasury notes rose to 2.518% from their U.S. close of 2.507%, though still well below a two-year high of 2.76% touched on July 8.
The euro slipped after the China data and was last down 0.2% at $1.3203. It rose as high as $1.3238 on Tuesday, its highest level since June 21.
Against the yen, the dollar took back some lost ground, rising 0.4% to 99.84 yen, moving away from a one-week low of 99.13 yen touched in the previous session.
Commodity markets had pushed higher ahead of the China manufacturing reading, but those gains unravelled in its wake.
Copper dropped 0.6% to $6,997.50 a tonne, after earlier touching a session high of $7,060, its loftiest since June 18. U.S. crude fell 0.1% to $107.11 a barrel.
Spot gold remained above the $1,300 an ounce after a four-session rally pushed prices to a one-month high on Tuesday, but it dropped 0.6% to $1,339.54 an ounce as investors took profits.