Asian shares moved lower on Wednesday, as the stronger yen continued to hammer Japanese exporters.
The yen rose to Y83.52 overnight in New York, its strongest level relative to the dollar since May 1995, though it slipped back later and is trading at Y83.57. The Japanese currency has risen to Y106.09 against the euro from Y106.32 in New York.
The MSCI Asia Pacific Index is down 0.7 per cent with Japan’s Nikkei 225 shedding 1.8 per cent, Australia’s S&P/ASX 200 Index off 0.3 per cent, South Korea’s Kospi Composite down 0.2 per cent and New Zealand’s NZX-50 down 0.4 per cent.
The falls tracked losses on Wall Street, with general sentiment unnerved amid renewed concerns about Europe’s banking sector
The yen’s strength hit exporters hard, with Canon dropping 2 per cent and Honda Motor off 2.7 per cent. Investors are wary over possible government intervention into the market, though Naoto Kan, prime minister, is unlikely to take action to curb the stronger yen before the ruling Democratic party’s presidential election next week.
Technology shares in Seoul were hurt by foreign selling. Samsung Electronics has dropped 1.3 per cent and Hynix Semiconductor is down 2.6 per cent on concerns about possible D-Ram chip oversupply early next year. Investors are closely watching for the Bank of Korea’s rate decision on Thursday as the central bank is likely to increase its benchmark interest rate to curb rising price pressure despite growing external uncertainty.
In Sydney, mining shares were lower again with BHP Billiton, the world’s largest mining company, down 1.3 per cent and Rio Tinto off 1.4 per cent on weaker commodity prices. The shares have also been weighed down by the increasing prospects of a mining tax after the Labor government led by Julia Gillard, prime minister, secured a second term.
In Hong Kong, China Mobile shares fell by the widest margin in more than a year after Vodafone said it is selling its 3.2 per cent stake in the world’s biggest phone carrier. The shares are down 3.9 per cent.
In Taipei, the Taiwan depository receipts of Yangzijiang, China’s fourth-biggest shipbuilder, made a strong debut, rising 6.9 per cent above their offer price. The company said in August it had received 28 shipbuilding orders worth $915m.
