Asian stocks fell to five-month lows on Friday as investors dumped riskier assets after growing sovereign debt problems in the euro zone and rising U.S. jobless claims sparked jitters about the global economic recovery.

European stocks <.FTEU3> were expected to extend the previous session's sharp losses on worries about high debt levels in Greece and Portugal, which have fueled market nervousness ahead of U.S. January non-farm payrolls data due at 8:30 a.m. EST.

U.S. stock futures, however, pointed to a slightly higher open after Wall Street dived 3 percent on Thursday, suffering its worst losses in more than nine months.

Underscoring how euro zone troubles are increasingly spilling over into global markets, sources said the Swiss National Bank intervened on Friday to weaken its own currency, which has appreciated rapidly as the euro tumbled, threatening the country's recovery.

Stock markets and commodity prices have recoiled this week on fears that growing troubles in Europe could impede or even derail an economic recovery that helped equities surge in 2009.

An unexpected increase in U.S. unemployment claims heightened those concerns ahead of the non-farm payroll data on Friday, a number that will be closely watched by markets given its implications for consumer demand in the world's biggest economy.

I think it's a confidence issue right now. We definitely do need to see unemployment in the U.S. start to decline before consumption can really start to pick up, said Lorraine Tan, director of Asia equity research at S&P in Singapore.

The payroll data is forecast to show a net 5,000 U.S. jobs were created last month, but the rate of unemployment is seen creeping up to 10.1 percent.

Japan's Nikkei average <.N225> dropped nearly 3 percent to its lowest close in two months, with exporters hurt by a stronger yen as well as the escalating problems in Europe. The yen, like the dollar, has firmed as investors move into assets traditionally seen as safe havens in times of market turmoil.

In Hong Kong, the benchmark Hang Seng Index <.HSI> was down 3 percent and on track to close below its 200-day moving average -- often used as an indicator of longer-term trends -- for the first time since April 30, 2009.

Taiwan <.TW11> stocks closed below their 200-day moving average for the first time since last April, shedding 4.3 percent in their biggest daily percentage fall in nearly 13 months.

Dariusz Kowalczyk, chief investment strategist at SJS Markets in Hong Kong, said worse may lay ahead for Asian stocks in the second quarter.

He said the waning impact of fiscal stimulus measures in big economies would trigger a double-dip recession in the United States, Europe and Japan by the end of the year, and that markets would see it coming.

When it comes to equities, markets usually anticipate changes in the direction of the global economy about two quarters before they occur, Kowalczyk said.

Obviously when you look at what's happening with the market this year, some might say the correction has already begun. But I think this correction, while it is painful, is not the major one that will come ahead of the double dip.

Asia Pacific stocks outside Japan as measured by MSCI <.MIAPJ0000PUS> fell 3.3 percent to levels last seen in early September. Declines were led by resource and tech stocks, which fell 4 percent on fears that global demand was faltering.

Asian stocks outside Japan have fallen nearly 10 percent this year after rising 68 percent in 2009 on the back of government measures worldwide that stimulated spending and dragged the global economy back from the abyss.


The U.S. dollar <.DXY> extended gains from the previous session as investor anxiety about sovereign debt in Greece, Portugal and Spain triggered a sell-off in the euro and growth-linked currencies such as the Australian dollar.

The dollar firmed 0.2 percent against a basket of other major currencies <.DXY>.

Overnight, the euro hit its lowest level in more than eight months against the dollar and plunged to a 15-month low against the Swiss franc.

But the common currency rebounded slightly in Asian trade after the Swiss central bank sold Swiss francs and bought euros to weaken its own currency, three people who saw the action said. The central bank would not comment.

The euro jumped to the day's high of 1.4905 francs on EBS after falling as far as 1.4551 francs, its lowest since October 2008, and later held around 1.4730 francs, up 0.6 percent on the day.

The Swiss National Bank has pledged to stem a sharp-run up in the franc against the euro because its fears a stronger franc will erode the country's export competitiveness and threaten its broader recovery.

The weakness in the euro was partly attributed to widening Greek, Portuguese and Spanish bonds' yield spreads over German benchmarks..

Crude oil futures rose 35 cents or half a percent to $73.49 a barrel, after suffering its biggest one-day fall since July on signs that U.S. energy demand is falling despite an apparent rebound in manufacturing.

(Editing by Kim Coghill)