Global stocks start quarter in doldrums as treasuries drop

Global stocks fell the most in more than three weeks as a new quarter got under way, with Japanese equities leading losses and the yen strengthening. Treasuries declined before US payrolls data. Europe's equity benchmark was set to erase all of its gains for March in a single day, and Japan's Topix had its worst day in seven weeks after the Tankan business survey slumped. Crude oil slid after Saudi Arabia's deputy crown prince said the kingdom will only freeze its oil output if Iran and other major producers do so. Copper rose after a gauge of Chinese manufacturing unexpectedly expanded, while shares in Shanghai were little changed.

Global equities ended the first quarter little changed after central bank efforts to shore up economies spurred gains in the past six weeks. That helped offset a selloff in January, fueled by concern over a deepening slowdown in China and a slump in oil prices. Friday's data onslaught, which includes consumer confidence and manufac- turing data as well as employment and wage figures, may provide clues to the Federal Reserve's pace of interest-rate increases.

"A good jobs number and signs of a stronger U.S. economy could give markets a little help," said Mathias Haege, who helps oversee 300 million euros ($342 million) as managing partner of Maxalpha Asset Consultant in Frankfurt. "The market is missing confidence. At the end of the day, it doesn't matter what central banks are doing if economic growth doesn't accelerate and corporate earnings continue to shrink."

The MSCI All-Country World Index dropped 0.8 percent at 6:07 a.m. in New York. The Stoxx Europe 600 Index retreated 1.7 percent after wrapping up its third quarterly decline in four on Thursday with a 1.1 percent drop as banks weighed heaviest on the index.

Japan's Topix index tumbled 3.4 percent as the country's Tankan surveys of business conditions indicated sentiment among large manufacturers was the weakest since mid2013. InterContinental Hotels Group Plc lost 1.1 percent. The shares had rallied recently amid a bidding war for U.S. peer Starwood Hotels & Resorts Worldwide Inc., which ended Thursday after a group led by China's Anbang Insurance Group Co. withdrew its offer. Marriott International Inc., now the frontrunner for Starwood, fell 4.8 percent in European trading.

ThyssenKrupp AG rose 6.2 percent following a report that it's in talks with Tata Steel Ltd. about possible participation in the German company's steel business.

Standard & Poor's 500 Index futures fell 0.3 percent, after U.S. equities ended the first quarter near where they began following a whipsaw ride that saw them rally from the worst-ever start to a year.

U.S. nonfarm payrolls expanded by 205,000 in March and the unemployment rate held at 4.9 percent while average hourly earnings increased 2.2 percent on the year, according to economists surveyed by Bloomberg. Data on manufacturing and consumer sentiment probably improved, other surveys showed.

Traders have cut the odds of an April rate increase to zero, with the probability of a move in June down to 20 percent after Fed Chair Janet Yellen this week reiterated that policy will be tightened gradually in light of uncertain global growth.

The MSCI Emerging Markets Index dropped 1.2 percent, after climbing 13 percent in March, the best monthly gain in almost seven years. When the equity gauge last increased more than 13 percent in May 2009, it declined the following month before resuming a rally in July.

The Shanghai Composite Index added 0.2 percent on Friday, following the biggest monthly advance in almost a year, as traders weighed gains in manufacturing and a cut in the nation's credit-rating outlook by S&P.

The purchasing managers' index increased to 50.2 in March, beating the median estimate of 49.4 in a Bloomberg survey. The non-manufacturing PMI rose to 53.8 from 52.7 in February. Readings above 50 signal improving conditions. S&P on Thursday cut China's rating outlook to negative from stable, saying the nation's economic rebalancing is likely to proceed more slowly than the ratings firm had expected.

The Hang Seng China Enterprises Index of mainland companies trading in Hong Kong slid 1.6 percent after rising on Thursday to the highest level since early January. Benchmark gauges in Russia, South Africa, South Korea and Taiwan dropped at least 0.8 percent on Friday.

Oil headed for the first weekly decline since February as OPEC output rose and expanding U.S. stockpiles kept inventories at the highest level in more than eight decades.

The Organization of Petroleum Exporting Countries increased supply by 64,000 barrels to 33.09 million a day in March as Iraqi output gained and Iran pumped at the highest level in almost four years, according to a Bloomberg survey of oil companies, producers and analysts.

Crude futures dropped 1.8 percent to $37.66 a barrel in New York on Friday. The warning by Mohammed bin Salman, 30, who's emerged as Saudi Arabia's leading political force, leaves the outcome of a meeting between OPEC and other big oil producers this month in question.