Asian markets mostly down, Tokyo extends losses

HONG KONG (AFP) – Asian markets were mostly down Wednesday, in spite of a Wall Street rally, with Tokyo extending the previous day’s fall as the yen strengthened following a Bank of Japan monetary policy shift.

Tokyo’s Nikkei fell 2.08 per cent, or 222.94 points to 10,486.99 and Seoul closed 0.81 per cent lower, losing 16.11 points to 1,980.41, but Sydney rose 0.18 per cent, or 8.7 points, to 4,787.8.

Hong Kong eased 0.10 per cent, shedding

23.89 points to 23,635.10 and Shanghai ended up 0.25 per cent, or 5.77 points, at 2,320.91 thanks to a late rally.

Japan’s Nikkei was hit after the central bank said Tuesday it would fall into line with the new government and set a two per cent inflation target, while also launching an unlimited asset-buying scheme from next year.

The bank also lifted its growth forecast, predicting gross domestic product would expand 2.3 per cent in the year ended March 2014, up from an earlier 1.6 per cent estimate.

But the BoJ moves were in line with expectations, which have seen the yen tumble against the dollar and euro, in turn sending equities flying higher.

“The BoJ monetary policy announcement came so completely within range of market expectations that it rang as a disappointment,” SMBC Nikko Securities general manager of equities Hiroichi Nishi told Dow Jones Newswires.

The yen began rising soon after Tuesday’s announcement and rose further in New York trade. However, it stabilised in Tokyo early Wednesday.

The greenback – which hit a two-and-a-half-year high of 90.24 yen before the BoJ move – bought 88.36 yen in afternoon trade, against 88.68 yen in New York on Tuesday.

The euro — which topped 120 yen last week — also slipped to 117.53 yen Wednesday, from 118.14 yen in New York and to $1.3298 from $1.3321.

Regional markets were largely unaffected by healthy gains on Wall Street Tuesday following a long weekend, thanks to stronger-than-expected earnings results, including from The Travelers Companies and DuPont.

The Dow rose 0.46 per cent, the S&P 500 added 0.44 per cent and the Nasdaq ended up 0.27 per cent.

Oil prices were slightly up, with New York’s main contract, light sweet crude for delivery in March, up two cents to $96.70 a barrel and Brent North Sea crude for March delivery up three cents to $112.45.

Gold was at $1,691.00 at 0820 GMT compared with $1,692.41 late Tuesday.

In other markets:

- Wellington was flat, edging up 0.64 points to 4,187.72.

Telecom fell 2.1 per cent to NZ$2.32 and Fletcher Building rose 0.5 per cent to NZ$9.34, while Air New Zealand was unchanged at NZ$1.24.

- Manila fell 0.20 per cent, or 12.37 points, to 6,092.53.

- Taipei fell 0.19 per cent, or 14.92 points, to 7,744.18.

Hon Hai Precision was 0.47 per cent lower at Tw$85.0, while HTC shed 2.07 percent at Tw$283.5.