Asian markets slip, yen advances against dollar

Asian markets mostly fell on Wednesday morning, with few catalysts to drive buying after recent gains, while Wall Street provided a limp lead.

The yen edged up slightly as investors weighed reports that Japan’s main opposition party will vote against one of the government’s nominations for deputy governor of the country’s central bank.

Tokyo fell 0.15 per cent, Hong Kong lost 0.47 per cent, Shanghai was off 0.33 per cent and Sydney slipped 0.29 per cent but Seoul gained 0.20 per cent.

Investors took a breather as they await fresh buying impetus, with the Dow extending its record-breaking run to six sessions but only by squeezing out a marginal gain of 0.02 per cent.

However, the broad-market S&P 500 fell 0.24 per cent, snapping a seven-session winning streak that had taken it to within a whisker of its all-time high. The tech-rich Nasdaq Composite dropped 0.32 per cent.

In Tokyo the Nikkei rolled back slightly as the dollar struggled to advance any further against the yen, having shot up by about 20 per cent since November.

The greenback saw some selling pressure on Tuesday in New York after reports that Japan’s largest opposition party said it would not back the nomination of Kikuo Iwata to serve as the Bank of Japan’s deputy governor.

Iwata, along with the nominee for governor Haruhiko Kuroda, is a strong supporter of giving more control of the BoJ to the government and an advocate of further aggressive monetary easing.

His failure to win approval could raise questions about Prime Minister Shinzo Abe’s clout, analysts said.

The Democratic Party of Japan, however, did say it would support the nominations of Kuroda and Hiroshi Nakaso, in line for the second available post as deputy governor.

But Sean Callow, senior currency strategist at Westpac in Sydney, told Dow Jones Newswires: “The local press is confident that all three nominees will eventually be accepted.”

On currency markets the dollar slipped to 95.08 yen in morning trade from 96.05 yen in New York late Tuesday. It had been at 96.40 yen earlier Tuesday in Asia.

The euro bought 125.09 yen and US$1.3037, compared with 125.19 yen and US$1.3035.

And the pound bought 1.4907 from US$1.4903 late Tuesday, with the British unit coming under fresh pressure after weak industrial production numbers fuelled fears the economy could slip into recession again.

Oil prices rose, with New York’s main contract, light sweet crude for delivery in April, gaining 23 cents to US$92.77 a barrel and Brent North Sea crude for April delivery increasing four cents to US$109.69.

Gold was at US$1,592.40 an ounce at 0200 GMT compared with US$1,582.70 late Tuesday.