The regional benchmark stock index of Asia is currently heading for its first advance in the last 3 days, as it is being driven by a rally in the Japanese exporters. Yen, the major Japanese currency has already weakened past 102 per USD. Incidentally, stocks outside Japan mostly saw tumbles.
The MSCI Asia Pacific Index has jumped up by 0.3% on today and it is currently at 142.28. In 2013, the gauge has posted a gain of 9.7% till date. Many are speculating that the Bank of Japan will be taking up more steps for beating the deflation. Incidentally, the policy makers of the Group of 7 countries signaled that for the time being, they will tolerate a sliding Yen. If Japan is excluded, the MSCI Asia Pacific Index has gone down by 0.8% and is at 480.89.
According to the Departmental Head of AMP Capital Investor’s Dynamic Asset Allocation, Nader Naeimi, the Japanese market is expected to be well supported given the fact that Yen is declining at a continuous basis. Apart from that, the Group of 7 countries seems to be pretty understanding as well, when it comes to the aggressive stimulus being delivered by Japan. There is still a risk of correction and currently, the risk-reward ratio is not that high as it was a few months ago, when the markets were lower.
The Nikkei 225 Stock Average went ahead by 1.2% on today and thereby, it was able to record its highest close since December, 2007. On the other hand, the broader Topix Index showed a jump of 1.8%. On today, Yen declined to as low as 102.15 per USD and the weak currency makes way for boosting the value of the overseas income at the Japanese exporters when repatriated.
The benchmark stock gauge of South Korea, Kospi Index went ahead by 0.2%. The NZX 50 Index of New Zealand posted a jump of 0.4%. On the other hand, the S&P/ASX 200 Index of Australia surged ahead by 0.1%. Taiex Index of Taiwan however declined by 0.4%.
The benchmark stock gauge of China, the Shanghai Composite Index went down by 0.2%, paring the earlier losses of 0.7%. One report coming out on today showed that for last month, the industrial output in China missed estimates. Interestingly, the retail sales went ahead. Hang Seng Index of Hong Kong however tumbled by 1%.