Japanese stocks held steady on Tuesday after early losses on signs of a slowdown in the U.S. economic recovery and oil fell for a second session as the dollar edged higher on euro debt concerns.

European shares were expected to slip for the fourth straight session, with a slide in commodity prices seen weighing on heavyweight miners and oil majors.

Britain's FTSE 100 <.FTSE>, Germany's DAX <.GDAXI> and France's CAC 40 <.FCHI> were all seen opening down almost 1 percent, according to financial spread betters.

Japan's benchmark Nikkei average <.N225>, the key Asian market for overseas investors, has slumped more than 3 percent over the last three sessions, in line with a pullback in other riskier assets as investors factor in the expected end of the U.S. Federal Reserve's stimulus program in June.

The Nikkei closed up just 0.09 percent, after earlier slipping close to 0.7 percent, while the broader Topix <.TOPX> was off 0.08 percent.

All eyes are now on commodities, said Takashi Ohba, a senior strategist at Okasan Securities. Normally falls in commodities would be considered positive for the economy, but these days that market has become a barometer for risk-taking -- commodities are lower, so everyone is in a 'risk-off' mood.

Seoul shares ended flat, overcoming some early pressure from foreign investor selling and declines in technology issues such as Samsung Electronics <005930.KS>.

Tech shares fell overnight on Wall Street and were the biggest drag on MSCI's index of Asia Pacific shares outside Japan. The index fell in the morning and was up 0.17 percent at 2 a.m. EDT. Samsung dropped more than 1 percent.

Some Asian markets, including Singapore, were closed for a holiday.

The dollar rose as high as around 81.23 yen after stop-loss buy orders were triggered slightly above 81 yen in a thin market.

The dollar index <.DXY>, a measure of its value against a basket of currencies, was up 0.18 percent, making dollar-denominated commodities more expensive for holders of other currencies.

The euro advanced to around 115.40 yen and $1.4181. It hit a seven-week low against the dollar the previous day and remains vulnerable due to concerns about the debt of peripheral euro zone countries.

The weekend arrest in New York of International Monetary Fund Managing Director Dominique Strauss-Kahn on charges of attempted rape sent shock waves through French political circles and left the IMF in turmoil, but had no apparent effect on Asian markets.

U.S. crude futures extended declines on Tuesday amid the global economic concerns and as U.S. industry data was expected to show a fourth-straight rise in the top consumer's crude oil inventories.

ICE Brent for July was down 26 cents at $110.58 a barrel. U.S. crude futures for June delivery fell 22 cents to $97.13.

Gold was steady and silver rebounded from a 5 percent drop the previous session, as some Asian physical buying offset the influence of a slightly stronger dollar.

Spot gold edged up to $1,494 an ounce. Inflation concerns rose in Europe as energy costs pushed up euro zone inflation in April, potentially adding to the appeal of bullion as a hedge.

A gauge of manufacturing in New York state fell much more than expected to provide the latest sign of a slowdown in the U.S. economic recovery, which pulled U.S. stocks and oil prices lower on Monday.

The Dow Jones industrial average <.DJI> lost 0.38 percent on Monday. The Standard & Poor's 500 Index <.SPX> fell 0.62 percent and the Nasdaq Composite Index <.IXIC> dropped 1.63 percent.

(Writing by Nick Macfie)