Asian shares mostly higher, yen hits record low versus euro

SYDNEY / WAM

Asian shares were mostly higher on Tuesday after recent losses, Reuters reported. Meanwhile, the battered yen hit a record low versus the euro, although the risk of intervention stemmed further weakness against the US dollar. With the first US presidential debate on Thursday and the first round of voting in the French election at the weekend, investors remain cautious of how political shifts in major economies could impact their positions.
US, Europe markets
The Europen market was mixed, with EUROSTOXX 50 futures falling 0.3 percent, but the FTSE was up 0.1 percent. Nasdaq futures rebounded 0.3 percent, having tumbled over 1 percent overnight thanks to a 7 percent drop in AI bellwether Nvidia. The Dow Jones Industrial Average, however, rallied 0.7 percent to a one-month high as investors added value stocks, which have been laggards in the recent tech-driven rally, to their portfolios.
Asia-Pacific
On Tuesday, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5 percent after three straight sessions of declines, helped by a 1.1 percent rise in Australia’s resources heavy shares.
Japan’s Nikkei gained 0.9 percent, Taiwanese stocks, which dropped more than 1 percent earlier in the session, clawed back lost ground and were last up 0.3 percent. Chinese shares were slightly lower, after oscillating between gains and losses. Hong Kong’s Hang Seng index rose 0.4 percent, after a recent leg lower found a floor near two-month lows. However, China’s economic recovery is still fragile. Reports said e-commerce sales declined for the first time during the so-called 618 shopping festival that ended last week.
The Chinese yuan keeps setting seven-month lows daily and has been pinned near the weak end of its daily trading band of 2 percent. The spot yuan hit 7.2630 per dollar on Tuesday after weak guidance from the central bank.
Forex
The dollar dipped a little after recent broad-based gains, with the dollar index down 0.1 percent to 105.37, after easing 0.3 percent overnight. The yen rose 0.2 percent to 159.29 per dollar, near levels not seen since late April when Japanese authorities intervened to stem the currency’s fast declines. Japanese Chief Cabinet Secretary Yoshimasa Hayashi said on Tuesday the authorities are closely watching currency moves and will respond to excessive volatility. The yen, however, kept weakening against other major currencies, with the euro breaking major resistance to hit a record top of 171.49 yen overnight. It was last at 171.17 yen.
US PCE
The US personal consumption expenditures (PCE) price index is due on Friday. Annual growth in the Federal Reserve’s favoured core inflation index is expected to slow to
2.6 percent in May, the lowest in more than three years. A low result would likely reinforce market bets on a Fed rate cut as early as September, which futures currently price as a 65 percent prospect. Two rate cuts are priced in for the year.
Bonds, commodities
Treasuries were steady amid a lack of catalysts. Two-year yields held at 4.7296 percent, little changed for the week, while the 10-year yield eased 1 basis point to 4.2340 percent, and was down
2 bps for the week. Oil prices were flat for the day. Brent futures held at $86.06 a barrel while US crude was little changed at $81.69 a barrel.
Gold prices slipped 0.2 percent to $2,327.20 per ounce.