WORLD MARKETS-Asian stocks down on slowing growth in China, trade war

* MSCI Asia excluding Japan vs. 0.5%

* China Q2 data show slower growth, lower industrial output

* Spreadeaders see their opening in Europe

By Andrew Galbraith [SHANGHAIJuly16(Reuters)-AsianstocksfellonMondayonWallStreetdatarevealingaslowdowningrowthoftheeconomyandproductioninChinacompoundingfearsaboutworseningofthetradewarwithWashington

Financial spreads are hoping for a mixed start in Europe: the German DAX will open 12 to 13 points to 12.562, the CAC 40 in Paris is expected to rise 11 points to 5.440 and the FTSE 100 London 10 points to 7.659.

The Chinese economy grew 6.7% in the second quarter of 2018, due to growth of 6.8% recorded in each of the previous three quarters. While GDP figures were in line with market expectations, the new data also showed slower-than-expected growth in Chinese industrial output, indicating a slowdown in momentum and prompting some analysts to call for more government action. strong to support growth.

Taken together, the data show that an economy continues to slow under the effect of a multi-year repression of excessive financial risks, even as the headwinds of the trade war come together.

But Jim McCafferty, head of equity research, Asia ex-Japan at Nomura, said China's underlying economic data seemed solid.

"I would be incredulous if China's GDP growth could be maintained at historical levels," he said. "So I think that there has always been a gradual slowdown, but the slowing of the growth rate is probably lower than what the market really wants to believe."

He said worries about the trade war were driving the markets, frightened by the escalating tensions of the trade war.

"That's why I think markets are nervous, because there is no precedent for this type of behavior," he said.

After briefly gaining on the initial gains on the Chinese stock market, the broadest index of the MSCI Asia Pacific region outside Japan fell 0.5%.

The Shanghai Composite Index was 0.8% lower than the afternoon trade, and the first-rate CSI300 index fell 0.9%.

The Hang Seng Hong Kong index was down 0.4%, but the China Enterprises index was more successful, falling 1%.

Australian stocks were down 0.5%, and Kospi from Seoul lost 0.4%. Taiwan's shares were 0.4% lower.

Japanese markets are closed Monday for holidays.

China's data eroded the mood of Wall Street markets, supported by strong earnings from industrial and energy companies, and helped temporarily distract investors from the US-China trade war.

U.S. Equity futures reached a new five-month high on Monday. The futures on the S & P500 e-mini, the most liquid equity index futures in the world, rose by 0.2% in the first Asian trade to reach their highest level since February 2, before reducing their earnings.

The dollar was flat against the yen at 112.40, and the euro was just 0.1 percent higher at 1.1697. The dollar index, which follows the greenback against a basket of six major rivals, fell 0.2 percent to 94,603.

The main currencies have been in a state of waiting in recent days thanks in part to a lull in China-United States. commercial skirmish. Investors are still turning to the June retail sales figures in the US to assess the state of global growth.

The Chinese yuan weakened the key rating of 6.7 for the dollar after Monday's data release, but then recovered from its losses. The yuan changed hands at 6.6851 per dollar around 0550 GMT.

The US Federal Reserve reiterated Friday in its semiannual report on monetary policy in the US Congress that it was expecting "further gradual increases" in interest rates as a result "solid" economic growth.

ANZ analysts said in a note on Monday that the Fed's report "produced few surprises," but noted that trade tensions continue to weigh on commodity markets and consumer confidence. US consumers.

U.S. Crude oil fell 0.5% to $ 70.65 a barrel, dampening worries about supply disruptions that had driven up prices. The price of Brent was 0.5% lower at $ 74.94 per barrel.

The market is now seen changing its view towards possible increases in supply, despite a Norwegian union for workers on offshore oil and gas rigs widening a strike six-day drilling on Monday.

The rising dollar caused gold prices to skyrocket on Friday, but gold rose 0.4% on Monday, trading at $ 1244.76 an ounce.