Asian stocks fall on risk of US rate rise

SINGAPORE, Apr 10 (Reuters) Asian share markets eased on Monday as recent gainers such as miner BHP Billiton took a hit after solid U.S. jobs data flagged the prospect of higher U.S. interest rates, which could hurt consumption.

Spot gold rose on renewed fund buying but stayed below a 25-year high of 8 an ounce hit last week, and oil gained on lost production in Nigeria and increased tensions between Iran and the West over Iran's nuclear programme.

The dollar slipped but stayed well above a seven-month low against the euro, underpinned by views the Federal Reserve would raise interest rates at least one more time. The Fed has raised rates 15 times since its tightening cycle began in June 2004.

''In the short term, interest rate concerns are going to weigh on sentiment,'' said Eric Betts, head of strategy with Nomura Australia Ltd. ''Rate-sensitive sectors like banks, property trusts and companies with large U.S. exposure will be hit.'' A stronger-than-expected March jobs report in the United States pushed U.S. stocks and bonds down on Friday.

Tokyo's benchmark Nikkei average <.n225> fell 0.53 percent to 17,469.42 by the midsession break. On Friday, it close above 17,500 for the first time since July 2000. The broader TOPIX index <.topx> was down 0.35 percent at 1,777.50.

The MSCI's index of non-Japan Asian shares <.msciapj> was off 0.44 percent at 0200 GMT.

Electronic components maker Kyocera Corp. fell 1.5 percent and chip-testing equipment maker Advantest Corp.

dropped 0.8 percent.

But INPEX Holdings jumped 6 percent after the oil developer said it planned to invest - billion to produce liquefied natural gas from its Ichthys field in Australia.

Hong Kong's Hang Seng <.hsi> opened 0.54 percent lower, Taiwan stocks <.twii> were flat, up 0.06 percent, and South Korea's main index <.ks11> dropped 0.25 percent.

Australian shares lost nearly 1 percent, as globally-geared companies such as BHP and building products maker Rinker fell after solid March data for U.S. payrolls.

DOLLAR SLIPS U.S. employers added 211,000 nonfarm jobs in March, the Labor Department said, exceeding economists' estimate for growth of 190,000 jobs. The unemployment rate fell unexpectedly in March to 4.7 percent, a 4-1/2-year low, from February's 4.8 percent.

Traders said the market would scrutinise a run of U.S. data due this week for clues about the Fed's action beyond May.

By 0200 GMT, the euro was near New York levels around .2103 , but well below a seven-month peak of .2333 hit last week.

The dollar was at 118.10 yen , down from around 118.30 yen marked in late U.S. trade on Friday.

Bond prices dipped after U.S. Treasuries plunged late last week after the solid U.S. jobs report.

Japanese government bonds fell, with the five-year yield hitting a record high, with traders also concerned that a strong reading in Japan's machinery orders data could stoke expectations the Bank of Japan might raise rates as early as July and keep hiking them gradually.

South Korean government bonds also slipped, rattled by a drop in U.S. Treasuries and ahead of the finance ministry's five-year debt auction.

NYMEX crude for May delivery was trading up 30 cents at .69 a barrel after having slipped 55 cents on Friday.

In Nigeria, militants whose attacks have shut a quarter of output threatened to execute anyone found on previously attacked oil platforms operated by Royal Dutch Shell .

Tension over Iran's nuclear programmme remained a supportive factor. The Bush administration insisted on Sunday its priority was to seek a diplomatic solution to the dispute over Iran's nuclear ambitions, amid reports of stepped-up planning for possible U.S. air strikes.

REUTERS PV SP1126