Euro sinks in Asia as Tokyo ends at 15-year high
People look at an electronic stock indicator of a securities firm in Tokyo, Wednesday, April 22, 2015. Asian stocks were mostly higher Wednesday after Japan reported its first trade surplus in three years, adding optimism to regional sentiment despite a fall on Wall Street. AP PHOTO/SHIZUO KAMBAYASHI
HONG KONG–Japanese shares ended above 20,000 Wednesday for the first time in 15 years as the country recorded its first trade surplus for almost three years, while the euro weakened on pessimism about a Greek bailout deal.
With few catalysts to spur business in Asia, several other markets fell following a broadly negative lead from Wall Street.
Tokyo jumped 1.13 percent, or 224.81 points, to finish at 20,133.90–ending above 20,000 for the first time since April 2000.
Shanghai climbed 2.44 percent, or 104.87 points, to end at 4,398.49 and Hong Kong rose 0.30 percent, or 83.36 points, to 27,933.85
But Seoul ended marginally lower, losing 0.90 points to 2,143.89, while Sydney shed 0.36 percent, or 34.84 points, to close at 5,837.50.
Tokyo’s Nikkei broke back through the 20,000 point barrier–after briefly clearing the hurdle earlier this month in intraday trading–as the yen slipped against the dollar.
“Since the Nikkei is a simple average of 225 (companies), what’s behind its rise are expectations for higher corporate earnings,” Toshihiko Matsuno, senior strategist at SMBC Friend Securities, told AFP.
“Where the market will go from here depends on how company earnings fare.”
Before the market opened the finance ministry said March saw the country enjoy its first trade surplus since June 2012 thanks to tumbling oil prices and a boost in exports.
However, economists warned the positive results might not last.
“We expect the yen to weaken further in coming months, which should lift the cost of imports by more than the yen–value of exports,” Marcel Thieliant at Capital Economics wrote in a commentary.
“The trade balance is unlikely to remain in surplus for long.”
The dollar was at 119.52 yen against 119.63 yen in New York but well up from 119.44 yen in Tokyo earlier Tuesday.
The dollar’s strength comes despite the diminishing likelihood of a US rate rise any time soon.
Athens backlash
“More and more the expectation is that the Fed won’t do anything soon. The momentum in equities is still there,” Evan Lucas, a markets strategist at IG in Melbourne, told Bloomberg News.
The euro slipped with investors nervously following events in Europe as Greece struggles to scrape cash together to pay its bills.
Athens is facing a backlash from the country’s mayors after it issued a decree ordering them to hand over their reserves in order to service its debts and pay wages.
The government is locked in negotiations with its international creditors on unlocking billions of euros in much-needed bailout funds. Failure to secure the cash will likely see it default and possibly crash out of the eurozone, which analysts fear could have global repercussions.
Greece’s creditors sounded the alarm Saturday over the pace of debt negotiations, with European Central Bank chief Mario Draghi saying: “More work, much more work is needed now, and it’s urgent.”
The euro slipped to $1.0730 and 128.40 yen from $1.0735 and 128.42 yen in US trade.
On Wall Street the Dow fell 0.47 percent Tuesday and the S&P 500 slipped 0.15 percent but the Nasdaq added 0.39 percent.
The next focus for investors is the release Thursday of HSBC’s preliminary report on activity in China’s manufacturing sector, which will give the latest indication about the state of the world’s No. 2 economy.
Oil prices were lower. US benchmark West Texas Intermediate fell 63 cents to $55.98 while Brent crude fell 52 cents to $61.56 in afternoon trade.
Gold fetched $1,199.00 against $1,198.35 late Tuesday.
In other markets:
— Singapore fell 0.35 percent, or 12.37 points, to 3,496.24.
DBS Bank declined 0.48 percent to Sg$20.88 while real estate developer Capitaland was up 0.27 percent to Sg$3.66.
— Kuala Lumpur dropped 8.03 points, or 0.43 percent, to 1,854.77.
AMMB Holdings lost 0.92 percent to 6.44 ringgit, while RHB Capital rose 1.86 percent to end at 8.20 ringgit. Malayan Banking slipped 0.11 percent to 9.49 ringgit.
— Bangkok slipped 17.34 points, or 1.10 percent, to 1,552.01
Energy firm PTT fell 2.26 percent to 346 baht, while bank SCB shed 2.54 percent to end at 172.50
— Jakarta lost 0.43 percent, or 23.45 points, to 5,437.12
Palm oil producer Astra Agro Lestari fell 1.18 percent to 23,075 rupiah, while state-owned lender Bank Mandiri slipped 1.03 percent to 12,025 rupiah.
— Wellington retreated 0.41 percent, or 23.90 points, to 5,793.61.
Meridan Energy slipped 2.38 percent to NZ$1.845 and Orion Health was down 1.75 percent at NZ$4.50.
— Taipei gained 0.83 percent, or 79.02 points, to 9,613.0.
Taiwan Semiconductor Manufacturing Co. closed 0.70 percent higher at Tw$143.5 while Cathay Financial Holding added 1.18 percent to Tw$51.4.
— Manila fell 0.18 percent, or 13.91 points, to 7,833.03.
Banco de Oro shed 1.55 percent to 114.60 pesos, SM Prime Holdings was down 1.04 percent at 19.10 pesos and DMCI Holdings was unchanged at 14.46 pesos.
— Mumbai rose 0.77 percent, or 214.09 points, to 27,890.13.
Hindustan Unilever climbed 3.59 percent to 905.10 rupees, while information technology firm Wipro fell 6.01 percent to 544.00 rupees.
