ASIA MARKETS: Japan Stocks Leap As Yen Weakens
August 28 2016 - 10:52PM
Dow Jones News
By Kenan Machado
Other Asian markets down after dollar gains
A rally in the U.S. dollar weakened the Japanese yen, sending
the Nikkei sharply higher Monday morning amidst broader equities
weakness elsewhere in Asia.
The Nikkei Stock Average was up 2.2% after the dollar surged, on
comments from Federal Reserve Chair Janet Yellen that the case for
an increase in short-term interest rates has strengthened in recent
months. A weaker yen helps Japanese exports.
There were expectations of hawkish commentary from the Fed and
investors were cautious leading up to the speech, analysts
said.
"All of the concerns and worries were addressed in this (Fed
Chair Yellen's) speech over the weekend," said Alex Wijaya, a
senior sales trader at CMC Markets.
The Fed comments sent U.S. shares lower on Friday, helping the
stock market there notch its biggest weekly decline since the
U.K.'s Brexit vote in June.
In early Asian trade, the U.S. dollar was broadly higher against
most local currencies. The yen was last down 0.2% against the
greenback.
Meanwhile, the Malaysian ringgit fell 0.7% against the dollar,
the Indonesian Rupiah was off 0.5%, and the Australian dollar fell
0.4%.
The dollar's strength pushed commodity prices lower. Brent
crude, the global benchmark, was trading down 42 US cents at $49.50
a barrel.
In Australia, the commodity-heavy S&P/ASX 200 traded 0.8%
lower, with Woodside Petroleum Ltd. (WPL.AU) falling 1.1% and Oil
Search Ltd. (OSH.AU) declining 1.9%. Rio Tinto Ltd. (RIO) and BHP
Billiton Ltd. (BHP.AU) fell 0.5% and 0.1% respectively.
Elsewhere in Asia, stocks were also under pressure as Yellen's
comments affirmed expectations of higher U.S. rates this year, and
could trigger fund flows into U.S. dollar assets.
The Shanghai Composite Index was last down 0.3%, while Hong Kong's Hang Seng Index lost 0.4%.
(END) Dow Jones Newswires
August 28, 2016 22:37 ET (02:37 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.