TOKYO: Asian shares eased on Thursday on renewed concerns about Chinese growth, but a brighter global economic outlook underpinned the dollar and kept investor risk appetite intact, reducing the appeal of safe-haven government debts.
The dollar touched a fresh 11-month high against the yen above 83.90 and hit a two-month high against a basket of major currencies above 80.630. The US currency held near Wednesday's one-month high against the euro of $1.3011.
US Treasury yields jumped to multi-month highs on Wednesday, driving Japanese benchmark yields to three-month highs on Thursday.
"The support for the USD responds to perceived positive news from the US, rather than negative news from Europe. This positive twist has extended the rally into equities," Barclays Capital analysts said. "We believe that the drivers behind a higher USD/JPY remain intact," they said.
The MSCI Asia Pacific ex-Japan index, was down 0.1 percent, weighed by a fall in resource-reliant Australian shares, which slipped on concerns about demand from China. Those worries also dragged commodity currencies lower.
Premier Wen Jiabao said on Wednesday China must embrace slower growth and bolder political reform to keep its economy from faltering. He also dampened hopes for any near-term easing measures in the country's property sector, sending Chinese shares lower.
Japan's Nikkei average opened up 0.7 percent. US stocks were choppy on Wednesday after hitting multi-year highs earlier in the week while stocks in Europe closed at a near 8-month high.
"The US recovery is starting to gain some traction," said Annette Beacher, head of Asia Pacific research at TD Securities in Singapore.
In a sign investors are shifting more into riskier assets, gold fell more than 2 percent in a second straight decline on Wednesday, and stood barely changed at $1,643 an ounce on Thursday.
It has shed about 5 percent or $80 per ounce over the past two days, erasing the premium it enjoyed based on expectations of further US monetary easing to stimulate the economy.
Another major safe-haven asset, US Treasuries, also came under selling pressure, pushing the benchmark 10-year yield
up to its highest since October at 2.28 percent on Wednesday.
That in turn pushed 10-year Japanese government bond yields up 4.5 basis points to a three-month high of 1.050 percent on Thursday.
Brent April crude fell $1.25, or 0.99 percent, to settle at $124.97 a barrel on Wednesday. US April crude futures edged up 0.2 percent to $105.68 a barrel on Thursday, after falling 1.2 percent to settle at $105.43.
Energy prices drove up consumer prices in the euro zone in February but industrial production showed factories expanded by 0.2 percent across the bloc as a whole in January, ending two consecutive monthly falls and pointing to the euro zone's eventual recovery from recession later this year.
Asian credit markets were steady early on Thursday, with the spread on the iTraxx Asia ex-Japan investment-grade index barely changed.
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