Asian shares mixed, yen slips

by Jonathan Adams
Yen

Nikkei 225 index added 2.2% to 38,655.03, while Hang Seng declined 3.5% to 21,661.99

Asian shares were mixed on Thursday after U.S. stocks were little changed as investors waited to see developments in the Middle East.

The U.S. dollar advanced against the Japanese yen as officials downplayed the likelihood of an interest rate hike soon.

That helped push Nikkei 225 index up. It added 2.2% to 38,655.03, while the dollar traded at 146.80 yen, up from 146.41 yen late Wednesday.

The dollar had been trading around 142 yen after the ruling Liberal Democrats chose Shigeru Ishiba to head the party and succeed Fumio Kishida as prime minister. Ishiba had expressed support for the central bank’s recent moves to hike its near-zero benchmark interest rate, which sits at almost 0.25%. That led traders to bet that the yen would gain in value.

But after a meeting between Ishiba and BoJ Gov. Kazuo Ueda, both of them hinted that the central bank did not view further rate hikes as suitable for the economy at this time. That prompted a flurry of selling of yen.

The meeting between Ishiba and Ueda was not expected to bring major news, however, “when Ishiba hinted that growing global risks should keep the BoJ firmly grounded, yen bulls hit the exits faster,” Stephen Innes of SPI Asset Management said in a commentary.

Elsewhere in Asia, Hong Kong’s Hang Seng declined 3.5% to 21,661.99 as investors locked in profits after it soared 6.2% a day earlier on a wave of investor enthusiasm over recent announcements from Beijing to boost the Chinese economy.

With Shanghai and other markets in China shut for a weeklong holiday, trading has crowded into Hong Kong. Markets in South Korea and Taiwan also were shut.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Trading and Investment News. The information provided on Trading and Investment News is intended for informational purposes only. Trading and Investment News is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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