* UK parliament passes Brexit bill as Scotland demands
* European stock markets set for mixed start
* Asia ex-Japan advance; Nikkei closes down 0.1 percent
* Markets expect Fed rate hike, look ahead to G20 meeting
* China investment, output beat f'casts, retail sales miss
* Oil retreats as rising U.S. supply dampens sentiment
By Nichola Saminather
SINGAPORE, March 14 Sterling dropped on Tuesday
after Britain's parliament paved the way for Prime Minister
Theresa May to launch divorce talks with the European Union,
while stocks advanced ahead of an expected U.S. interest rate
later in the week.
European stocks were set for a mixed start, with financial
spreadbetters expecting Britain's FTSE 100 and Germany's
DAX to dip in early trade, while France's CAC 40
was seen inching up.
The pound weakened 0.5 percent to $1.2155 after
both houses of parliament backed the so-called Brexit bill,
opening the door for May to start the clock on the required
two-year negotiation period by the end of this month.
The euro lost almost 0.1 percent to $1.0645,
extending Monday's 0.2 percent loss.
On Monday, sterling had jumped 0.36 percent after Scotland's
First Minister Nicola Sturgeon demanded a new independent
referendum in late 2018 or early 2019, once the terms of the
UK's exit from the EU are clearer.
The MSCI's broadest index of Asia-Pacific shares outside
Japan was up 0.2 percent, while Japan's Nikkei
closed down 0.1 percent.
Shares of Toshiba Corp. closed up 0.5 percent after
plunging as much as 8.8 percent, their biggest one-day loss in
almost a month.
The company said it would "aggressively consider" a sale of
most of Westinghouse and announced it had received approval from
regulators to extend for a second time the Tuesday deadline for
its official third-quarter earnings.
Its statement earlier in the session that it had requested
the extension to expand a probe into problems at its U.S.
nuclear unit Westinghouse sent the shares tumbling.
Chinese shares reversed early gains after data showed retail
sales cooled more than expected in the first two months of the
Other China data on Tuesday was more upbeat and positive for
the global economy, with investment and industrial output
expanding more than expected, but investors feared those signs
of strength may not be sustainable.
China has cut this year's economic growth target to about
6.5 percent to give policymakers more room to push through
painful reforms to contain financial risks. The economy grew 6.7
percent in 2016, the slowest pace in 26 years.
On Monday, Goldman Sachs upgraded Chinese stocks to
"overweight" on better growth prospects and a bullish view on
the country's banking sector. Its strategists cited rising
producer prices and easing credit stress, and a brighter credit
outlook and loan pricing for banks.
Overnight, Wall Street was mixed, with the Dow Jones
Industrial Average down 0.1 percent, while Nasdaq
rose 0.24 percent and the S&P was little changed.
With an interest rate hike this week by the Federal Reserve
fully priced in, markets are focused on any clues from the U.S.
central bank about the pace of future rises.
"On one hand, the market ponders a surprise hold, in which
massive unwinding of positions could take place with the hike
already priced in," Jingyi Pan, market strategist at IG in
Singapore, wrote in an note.
"On the other hand, concerns have also been paid to an
acceleration in the Fed’s path to normalisation, where the
likelihood of four Fed hikes has been raised, up from the
current projection of three," she said.
"The immediate reaction is likely to be seen in the dollar
and upsides towards December’s high on the dollar index may be
The dollar index was 0.2 percent higher at 101.49,
extending Monday's gains following a bout of profit taking at
the end of last week.
The dollar gained 0.1 percent to 114.92 yen, but
remains below the seven-week high touched on Friday on
expectations of a Fed move at the end of a two-day meeting on
Markets are also awaiting a meeting of the Group of 20
finance ministers and central bankers in the German town of
Baden Baden starting on Friday, their first meeting since Donald
Trump won the U.S. presidential election.
U.S. Treasury Secretary Steven Mnuchin will be "pushing
hard" to advance U.S. interests in his debut G20 meeting,
including reaffirming commitments to avoid competitive currency
devaluations, a senior Treasury official said on Monday.
In commodities, oil prices dipped after touching a
3-1/2-month low in the previous session as concerns about rising
U.S. production offset optimism about supply cuts by the
Organization of Petroleum Exporting Countries.
U.S. crude fell 0.1 percent to $48.36 a barrel, while
global benchmark Brent was flat at $51.35.
Gold slipped 0.1 percent to $1,202.52 ahead of the
(Reporting by Nichola Saminather; Editing by Kim Coghill and