Yen weighs on Japan shares, Asia stocks tip gains


Sydney - The yen strengthened in early trading, likely weighing on shares in Tokyo when Japan’s market opens. Asian equities elsewhere were poised for gains.

Stock-index futures in China, Australia, and Hong Kong pointed to a higher open for cash markets. Australian bonds declined.

The dollar fell against Japan’s currency as Asian traders reacted for the first time to Donald Trump’s inauguration and comments by Bank of Japan Governor Haruhiko Kuroda that the greenback could strengthen.

Trump began work as US President after saying he’d place American interests at the forefront of his agenda. His pro-growth campaign-trail pronouncements helped drive a rally in equities since November, while the dollar surged and bonds slumped. Some of those trades are unwinding this month as investors assess whether those moves had pushed prices too far, too fast.

Money managers will be dissecting earnings from some of the world’s largest companies this week with Alphabet, Samsung Electronics and Alibaba all reporting results.

“Markets are now waiting for more evidence that Donald Trump will deliver on fiscal stimulus and deregulation,” said Shane Oliver, Sydney-based global investment strategist at AMP Capital Investors, which manages about $120bn.

“Shares remain vulnerable to a further correction or consolidation in the next month or so.”

Here are the main moves in markets:

The yen rose 0.2% to ¥114.40/$ as of 08:50. The Bloomberg Dollar Spot Index has fallen for four straight weeks, its longest retreat since February.

The yield on 10-year Australian government bonds rose one basis point to 2.79%.

Futures on Australia’s S&P/ASX 200 Index rose 0.5%, while those on the Hang Seng and the FTSE China A50 indices both added 0.2%.

New Zealand’s S&P/NZX 50 Index fell 0.1%. Futures signaled a mixed open for Japanese equities. The S&P 500 Index advanced 0.3% on Friday.

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