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Asian stock markets : https://tmsnrt.rs/2zpUAr4

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Nikkei slips, S&P 500 futures steady

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Euro put on defensive by French political worries

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SNB may cut rates to restrain franc gains on euro

By Wayne Cole

SYDNEY, June 17 (Reuters) - Asian share markets were

mostly softer on Monday ahead of a slew of Chinese economic

news, while political uncertainty in Europe soured risk

appetites and kept the euro on the defensive.

Analysts expect annual growth in China's retail sales picked

up to 3.0% in May, from 2.3%, with some upside risk thanks to

holidays that month. Industrial output is seen slowing a little

to 6.0%, from 6.7%, with growth in urban investment steady.

There was also talk the People's Bank of China (PBOC) could

cut a key lending rate by 10 basis points, in part due to

surprisingly weak bank lending data released on Friday.

That made for a cautious start, and MSCI's broadest index of

Asia-Pacific shares outside Japan was a fraction

softer.

Japan's Nikkei slipped 1.7%, with investors now

facing a six-week wait to hear details of the Bank of Japan's

next tightening steps.

S&P 500 futures were flat, while Nasdaq futures

edged up 0.1% after a run of record finishes.

Analysts at Goldman Sachs have raised their year-end target

for the S&P 500 to 5,600, from 5,200 and the current 5,431.

"Our 2024 and 2025 earnings estimates remain unchanged but

stellar earnings growth by five mega-cap tech stocks have offset

the typical pattern of negative revisions to consensus EPS

estimates," they wrote in a note.

The main U.S. data of the week will be retail sales for May

on Tuesday, where a 0.4% bounce is expected after a 0.3% drop in

April, while markets have a holiday on Wednesday.

At least 10 policy makers from the Federal Reserve are due

to speak this week and will no doubt address the market's wagers

for two rate cuts this year.

While the Fed itself sounded a hawkish note last week, a

trio of soft inflation numbers led futures price in a

76% chance of a cut as early as September and 50 basis points of

easing for the year.

EYES ON SNB

Central banks in Australia, Norway and the UK are all

expected to hold rates steady at meetings this week, though the

Swiss National Bank (SNB) might well ease given the recent

strength of the Swiss franc.

Markets have boosted the probability of a cut to 75% as

political uncertainty in France drove the euro to a four-month

trough at 0.9505 francs on Friday.

French markets endured a brutal sell-off last week ahead of

a snap election that might give a majority to the far right,

with risks to the country's fiscal position and the stability of

the euro zone.

European Central Bank policymakers told Reuters they had no

plans to launch emergency purchases of French bonds to stabilise

the market after yield spreads over German bunds widened

dramatically amid a flight to safety.

"A French challenge to the region's fiscal arrangements would

be problematic and have far-reaching implications," warned

analysts at JPMorgan. "At this stage, the situation in the

run-up to the first round of voting is still very fluid."

That left the euro pinned at $1.0706, after

shedding 0.9% last week to touch a six-week low of $1.06678.

The dollar was a shade firmer on the yen at 157.54

, after briefly spiking above 158.00 on Friday when the

BOJ said it would start tapering bond buying a little later than

many had wagered on.

In commodity markets, gold held at $2,326 an ounce,

after bouncing 1.7% last week.

Oil prices eased a touch after rallying 4% last week amid

hopes for stronger demand from the U.S. driving season.

Brent dipped 17 cents to $82.45 a barrel, while U.S.

crude also fell 17 cents to $78.28 per barrel.