Yen Advances As Japan Stocks Fall
Tuesday morning in Asia, the yen soared against its major counterparts as a decline in Tokyo stocks boosted demand for the safe-haven Japanese currency.
After opening higher, Tokyo stocks fell today morning as a stronger yen and domestic economic worries about government and corporate finances continued to weigh on the market after a three-day weekend, eclipsing support from Wall Street’s rally overnight and gains in resource-related issues.
The benchmark Nikkei 225 index, which edged up to 9,511 in early trades but fell to 9,441.6 subsequently, is currently down 73.69 points or 0.78% at 9,423.99.
The yen that closed yesterday’s trading at 88.98 against the dollar rose to 88.84 in early Asian deals on Tuesday. The near term resistance for the Japanese currency is seen at 88.6.
During early Asian deals on Tuesday, the yen climbed to 132.73 against the euro and 147.15 against the pound. If the yen gains further, it may target 131.8 against the euro and 146.3 against the pound. The euro-yen and the pound-yen pairs were worth 133.13 and 147.77, respectively at yesterday’s close.
The yen jumped to 87.87 against the Swiss franc during early Asian trading on Tuesday. On the upside, 87.2 is seen as the next target level for the Japanese currency. At yesterday’s close, the franc-yen pair was quoted at 88.13.
Looking ahead, the Bank of Japan will release its monthly report at 12:00 am ET.
The Swiss October UBS consumption indicator and third quarter employment level, German final third quarter GDP, imports and exports, French November business confidence indicator, German IFO business climate report for November and the Euro-zone September industrial new orders are expected to influence trading in the European session.
From the U.S., the Bureau of Economic Analysis is due to release its third quarter GDP report at 8:30 am ET. The report is likely to show that the U.S. economy expanded at a 2.9% rate in the quarter.
Advance estimates revealed that the U.S. economy expanded at a 3.5% rate in the third quarter compared to a 0.7% contraction in the second quarter. Economists had expected a more modest 3.2% GDP growth.
At 9:00 am ET, the S&P/Case-Shiller home price index is scheduled to be released. Economists expect a 9.05% year-over-year decline in the 20-city composite house price index for September.
The Conference Board is scheduled to release its consumer confidence report for November at about 10 am ET. The report is expected to show that the consumer confidence index edged down to 47.5 in November.
