Asian stocks were trading mixed Tuesday with the Japanese market sharply underperforming amid a stronger yen, while the Australian market was modestly higher ahead of the Reserve Bank of Australia's policy decision.
Japan's Nikkei Stock Average was down 1.7% after dropping by as much as 2.7% in early trading, falling to its lowest level since March 6 amid a stronger yen.
"The selloff is more due to the strong yen than an overheated market per se," said Tatsunori Kawai, chief Strategist at kabu.com. "Heading into (fiscal year) end earnings reporting season, investors are looking for the dollar to hold around at least the Y95 mark. The Nikkei could keep correcting to the 11,300 level within the month if this doesn't happen."
Japanese exporters were lower with technology stocks bearing the brunt of selling. Nikon dropped 4.6%, Canon lost 2.8% and Tokyo Electron slid 3.8%.
The yen strengthened against the U.S. dollar in the lead up to the Bank of Japan's much-anticipated policy meeting later this week as investors speculated about whether or not the central bank will be able to meet the market's easing expectations. The dollar fell below Y93.00 in early trading for the first time since March 6, and was recently at Y93.06 compared with Y93.21 late Monday in New York.
In Sydney, the S&P/ASX 200 was modestly higher, up 0.2%, as investors awaited the Reserve Bank of Australia's policy decision. With the central bank widely expected to hold interest rates at 3.0%, focus is on the accompanying policy statement for any signs of a change in its outlook.
"(Focus) will be on the statement's wording, with most attention on the final paragraph. For the past two months the RBA has judged that the inflation outlook is low enough to "afford scope to ease policy further, should that be necessary to support demand." A minority of pundits has suggested that the RBA is so firmly on hold that it will remove this phrase today. If it does so, AUD/USD would probably finally break through 1.0500," Westpac's Sean Callow writes in a note to clients.
The Australian dollar was recently at US$1.0437 compared with US$1.0422 late Monday in New York.
South Korea's Kospi Composite was off 0.1%.
-Write to John Phillips at john.phillips@dowjones.com
(END) Dow Jones Newswires
Japan's Nikkei Stock Average was down 1.7% after dropping by as much as 2.7% in early trading, falling to its lowest level since March 6 amid a stronger yen.
"The selloff is more due to the strong yen than an overheated market per se," said Tatsunori Kawai, chief Strategist at kabu.com. "Heading into (fiscal year) end earnings reporting season, investors are looking for the dollar to hold around at least the Y95 mark. The Nikkei could keep correcting to the 11,300 level within the month if this doesn't happen."
Japanese exporters were lower with technology stocks bearing the brunt of selling. Nikon dropped 4.6%, Canon lost 2.8% and Tokyo Electron slid 3.8%.
The yen strengthened against the U.S. dollar in the lead up to the Bank of Japan's much-anticipated policy meeting later this week as investors speculated about whether or not the central bank will be able to meet the market's easing expectations. The dollar fell below Y93.00 in early trading for the first time since March 6, and was recently at Y93.06 compared with Y93.21 late Monday in New York.
In Sydney, the S&P/ASX 200 was modestly higher, up 0.2%, as investors awaited the Reserve Bank of Australia's policy decision. With the central bank widely expected to hold interest rates at 3.0%, focus is on the accompanying policy statement for any signs of a change in its outlook.
"(Focus) will be on the statement's wording, with most attention on the final paragraph. For the past two months the RBA has judged that the inflation outlook is low enough to "afford scope to ease policy further, should that be necessary to support demand." A minority of pundits has suggested that the RBA is so firmly on hold that it will remove this phrase today. If it does so, AUD/USD would probably finally break through 1.0500," Westpac's Sean Callow writes in a note to clients.
The Australian dollar was recently at US$1.0437 compared with US$1.0422 late Monday in New York.
South Korea's Kospi Composite was off 0.1%.
-Write to John Phillips at john.phillips@dowjones.com
(END) Dow Jones Newswires
