HONG KONG - Asian markets were mostly lower Monday despite figures from HSBC that it said could dampen fears of a slowdown in the world's number two economy and as investors awaited key events this week.

Tokyo fell 0.29 per cent by the break, Hong Kong was 0.52 per cent lower, Sydney shed 0.19 per cent, Seoul was off 0.18 per cent and Shanghai was 0.17 per cent down.

The preliminary HSBC China manufacturing purchasing managers index rose to a two-month high of 49.1 in April compared with a final reading of 48.3 in March.

A reading above 50 indicates expansion, while a reading below 50 suggests contraction.

"As April flash PMI ticked higher. This suggests that the earlier easing measures have started to work and hence should ease concerns of a sharp growth slowdown," HSBC chief economist for China Qu Hongbin said in a statement.

However, "the pace of both output and demand growth remains at a low level in a historical context and the job market is under pressure. This calls for additional easing measures in the coming months," he added.

The British banking giant's data mark the sixth straight month that the reading remained in contraction.

Investors will be watching the Bank of Japan's policy meeting and the US Fed's Open Market Committee meeting later this week, both of which could see the announcement of new easing measures.

"There are plenty of data and events this week including central banks in the US, Japan and New Zealand that will capture attention," Credit Agricole said in a note to clients, according to Dow Jones Newswires.

"Political events in France and bond auctions in the eurozone will also provide direction. We continue to see risk aversion creeping higher against this background, which in turn will keep risk assets on the backfoot," it added.

The IMF raised US$430 billion (S$537 billion) in new funds for crisis intervention Friday, with China and other emerging economic giants taking part despite worries the money will go to more eurozone bailouts.

"We have commitments that are north of US$430 billion. That almost doubles the lending capacity of the fund," IMF managing director Christine Lagarde said after meetings of the IMF and the finance chiefs of the Group of 20 economic powers.

It came at a time when worries were mounting that Spain and Italy could founder and require international support following rescues for Portugal, Ireland and Greece.

The euro eased against the dollar and yen in Asia as investors digested news that Socialist challenger Francois Hollande had beaten Nicolas Sarkozy in the first round of France's presidential election.

The euro inched down to US$1.3192 and 107.34 yen (S$1.6481) from US$1.3216 and 107.77 yen in New York late Friday.

The dollar fell to 81.37 yen from 81.52 yen.

The Dow climbed 0.50 per cent on Friday, the broader S&P 500 was up 0.12 per cent but the Nasdaq fell 0.24 per cent.

The Fed's interest rate-setting panel will meet Tuesday and Wednesday to decide whether more stimulus for the spluttering economy is warranted.

While Fed Chairman Ben Bernanke has sounded more positive in recent weeks, high gasoline prices, slowing job growth and Europe's debt problems have raised fears of another spring stumble.

But faced with a moderate, if uncertain, economic outlook, and good reasons not to push ahead with new stimulus, the Fed is expected to stand pat.

On oil markets, New York's main contract, light sweet crude for delivery in June, shed 15 US cents to US$103.73 and Brent North Sea crude for June delivery retreated eight cents to $118.68.

Gold was at US$1,641.50 an ounce at 0345 GMT (11.45am, Singapore time), compared with US$1,643.62 late Friday.