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Japan's Nikkei jumps on weaker yen

Source : AP
Last Updated: Tue, Feb 12, 2013 03:00 hrs

Tokyo's Nikkei 225 led Asian stocks higher Tuesday as the yen weakened after a possible candidate for Bank of Japan governor voiced support for easier monetary policy.

The yen has dropped almost 8 percent against the dollar this year after Japan elected Prime Minister Shinzo Abe in December. Abe has been calling for Japan's central bank to ease monetary policy more aggressively to help spur economic growth.

The Nikkei, which was closed Monday for a public holiday, jumped 2.3 percent to 11,413.38 as the weaker yen boosted export stocks. Australia's S&P/ASX 200 rose 0.1 percent to 4,963.60. South Korea's Kospi fell 0.1 percent to 1,949.02 while benchmarks in New Zealand, Indonesia and the Philippines rose.

Markets in mainland China, Hong Kong, Singapore, Malaysia and Taiwan were closed for Lunar New Year holidays.

Japan's central bank governor Masaaki Shirakawa, who has appeared at odds with Abe's views on monetary policy, is resigning next month, giving the government an opportunity to find a more closely aligned successor.

Asian Development Bank President Haruhiko Kuroda voiced support Monday for Abe's economic policies including the introduction of a 2 percent inflation target but kept mum about speculation he may become the next BOJ governor. In an interview with media organizations including Kyodo News, Kuroda said the BOJ's introduction of the target, proposed by Abe, was "epoch-making" and should be achieved "in about two years."

Wall Street stocks drifted lower in thin trading Monday. With major indexes near records, many think the six-week rally is ready for a pause. The Dow Jones industrial average fell 0.2 percent to 13,971.24. The S&P 500 dipped less than 0.1 percent to 1,517.01. The Nasdaq composite slipped less than 0.1 percent to 3,192.00.

Benchmark oil for March delivery was down 9 cents to $96.94 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.31 to finish at $97.03 a barrel in New York on Monday as the euro strengthened against the dollar.

In currencies, the euro rose to $1.3401 from $1.3389 late Monday in New York. The dollar rose to 94.23 yen from 93.70 yen.

The euro has strengthened recently, raising concern it will hurt exports from the 17 euro countries. French President Francois Hollande has suggested the eurozone needs to manage its exchange rate. ECB President Mario Draghi indicated the bank does not seek any particular exchange rate, which is set by markets, but is monitoring the stronger euro's effect on inflation.

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