SINGAPORE (Feb 5): Asian stocks were little changed as investors weighed the European Central Bank’s tightening of the terms of Greece’s bailout against China’s decision to reduce banks’ reserve ratios.

The MSCI Asia Pacific Index traded at 141.84 as of 9:04 a.m. in Tokyo. The ECB heaped pressure on Greece’s new government by restricting access to its direct liquidity lines, citing concerns about the country’s commitment to existing bailout pledges. China cut the amount of cash banks must set aside as reserves by 50 basis points, joining more than a dozen global counterparts in easing monetary policy this year.

“The good news out of China could help offset the bad news out of Greece,” Nader Naeimi, who helps manage about $125 billion as Sydney-based head of dynamic asset allocation at AMP Capital Investors, said by phone. “We’d get strong market reaction to China’s move to cut reserve requirements, while the Greek situation is going to induce some volatility.”

Japan’s Topix index, South Korea’s Kospi index, Australia’s S&P/ASX 200 Index and New Zealand’s NZX 50 Index each dropped 0.1 percent. Markets in China and Hong Kong have yet to open. China’s Shanghai Composite Index slipped 1 percent yesterday after a private gauge of the nation’s services industry expanded at the weakest pace in six months.

China Futures

FTSE China A50 futures jumped 5.1 percent in the most recent trading session in Singapore after on the government’s first cut to lenders’ reserve-requirement ratios since 2012 to bolster the flagging economy.

“This is very positive for the stock market,” Khiem Do, Hong Kong-based head of multi-asset strategy at Baring Asset Management Asia Ltd., said by phone. “We should see a continuation of interest-rate and reserve-ratio cuts in the next six to 12 months. Financials and cyclical sectors will benefit the most.”

Futures on the Standard & Poor’s 500 Index slipped 0.3 percent today. The U.S. equity benchmark index sank 0.4 percent yesterday on the ECB move and as oil retreated for the first time in five days.

Energy shares declined in Asia today after crude fell 8.7 percent yesterday in New York and 6.5 percent in London as a government report showed the highest U.S. supply in at least three decades.