By Dominic Lau
TOKYO (Reuters) - The dollar steadied above seven-week lows on Friday but remained vulnerable to more losses if Chinese data adds to a growing view Beijing was taming its economic slowdown, while Japanese stocks rose but were still on track for a heavy weekly fall.
Copper was holding near two-month highs hit after unexpected strength in trade data from top buyer China on Thursday raised hopes of a pick-up in demand.
The dollar was up 0.1 percent against a basket of major currencies, having fallen for five days in a row -- its longest such streak since mid-June -- on uncertainty about when the U.S. Federal Reserve would start winding back its stimulus.
If Chinese production and inflation data on Friday further suggest stabilisation in the world's second-largest economy after a slowdown that has run for more than two years, risk-seeking investors would be more confident about switching out of dollar.
"The investment climate isn't bad, as U.S. and Chinese data show improvement," said IM Investment & Securities analyst Kang Hyun-gie. "A batch of new Chinese data coming out later will certainly function as a catalyst for the market today."
NIKKEI'S WEEKLY LOSS
With the dollar up 0.2 percent at 96.90 yen in early deals, Tokyo's Nikkei share average climbed 1 percent. Still the Nikkei hit a six-week low on Thursday and is down about 5 percent this week as the yen has strengthened.
"Although the dollar rebounded against the yen yesterday, it doesn't feel like it has bottomed out. The chart looks still very weak and I suspect there's chance the dollar will test 95 yen in the near future," a trader at a Japanese bank said.
The euro hovered near a seven-week high versus the dollar at $1.33810.
Asian shares as measured by MSCI Asia-Pacific ex-Japan were steady after gaining nearly 1 percent on Thursday.
Japanese shares' 12-month forward price-to-earnings ratio has fallen to 13.8 from a two-month high of 14.8 hit last week, according to Thomson Reuters Datastream.
Valuations for the MSCI Asian gauge have also eased to 11.4 from a two-month high of 11.5 reached last week.
In the commodity markets, copper prices were steady at around $7,185 a tonne after climbing 2.6 percent to a two-month after the Chinese trade data.
Gold added 0.2 percent, extending Thursday's 1.9 percent rise. Brent crude prices were up 0.2 percent, on track to end a five-day run of losses - its longest such run since mid-April.
(Additional reporting by Jungmin Jang in SEOUL and Hideyuki Sano in TOKYO; Editing by John Mair)
