Markets

Asian markets mostly up, Tokyo soars on weaker yen

HONG KONG: Asian markets mostly rose Wednesday following big losses in the previous session, with Tokyo surging as the
Published February 6, 2013

asian market1 400HONG KONG: Asian markets mostly rose Wednesday following big losses in the previous session, with Tokyo surging as the yen tumbled after Bank of Japan governor Masaaki Shirakawa said he will step down early.

 

Traders also took a lead from Wall Street and Europe, where encouraging economic data offset concerns over political uncertainty in Spain and Italy.

 

Tokyo soared 3.37 percent, or 416.83 points, to 11,463.75 -- its highest close since September 2008 soon after the collapse of US bank Lehman Brothers and at the height of the financial crisis.

 

Sydney climbed 0.78 percent, or 38.3 points, to 4,921.0 and Taipei rose 0.25 percent, or 19.71 points, at 7,906.65. But Seoul lost 1.99 points to close at 1,936.19.

 

In the afternoon Hong Kong added 0.80 percent and Shanghai was up 0.28 percent.

 

Wellington was closed for a public holiday.

 

Japanese foreign exchange traders welcomed Shirakawa's announcement that he would step down on March 19, about three weeks before the end of his term.

 

It fuelled expectations that Prime Minister Shinzo Abe will likely fill the post with someone who shares his ideas on aggressive monetary easing that would see more yen pumped into the economy.

 

The Japanese currency tumbled in New York. By the end of trade Tuesday the dollar bought 93.61 yen and the euro was at 127.13 yen, compared with 92.28 yen and 124.67 yen earlier in the day in Tokyo.

 

In afternoon Tokyo trade on Wednesday the dollar bought 93.75 yen and the euro fetched 127.20 yen.

 

Yen "weakness has resumed with a vengeance", National Australia Bank said.

 

The euro was also at $1.3562, compared with $1.3582 in New York and much stronger than the $1.3489 Tuesday in Tokyo.

 

Major Japanese exporters have been raising their earnings outlooks thanks to recent weakness in the yen, heartening investors.

 

"Global markets continue to normalise, allowing risk-on trading to resume," said SMBC Nikko Securities general manager of equities Hiroichi Nishi.

 

"This is partially reflected in the fall of the yen," he told Dow Jones Newswires.

 

Regional markets resumed their upward trend after suffering a heavy jolt on Tuesday after Spain's Prime Minister Mariano Rajoy was forced to deny corruption claims.

 

A surge in the polls for the party of former Italian premier Silvio Berlusconi, who has said he would roll back recent austerity measures, spooked markets ahead of an election this month.

 

However, encouraging data showed US services sector activity rising and the contraction in eurozone business activity decelerating.

 

Wall Street rebounded after diving Tuesday as the Dow sits close to record highs. The Dow ended 0.71 percent higher, the S&P 500 climbed 1.04 percent and the Nasdaq rose 1.29 percent.

 

In Europe markets on Tuesday recovered some of the huge losses suffered in the previous session.

 

Oil prices rose, with New York's main contract, light sweet crude for delivery in March up two cents to $96.68 a barrel in morning trade and Brent North Sea crude for March delivery climbing 18 cents to $116.70.

 

Gold was at $1,673.00 at 0630 GMT compared with $1,678.01 late Tuesday.

 

Copyright AFP (Agence France-Presse), 2013

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