Nikkei up as yen spurs stimulus hope, other Asia stocks slip

Staff Writer
Columbus CEO

HONG KONG (AP) — Japanese stocks rose Friday as the yen's strength stoked investor hopes for more stimulus to stop the currency from rising further and support the government's economic revival plan. Other Asian benchmarks fell following losses on Wall Street.

KEEPING SCORE: Japan's benchmark Nikkei 225 index erased earlier losses by the afternoon trading session, rising 1.6 percent to 15,993.46. South Korea's Kospi lost 0.3 percent to 1,967.87. Hong Kong's Hang Seng retreated 0.4 percent to 20,189.40 and the Shanghai Composite Index in mainland China fell 0.7 percent to 2,988.45. Australia's S&P/ASX 200 slid 0.5 percent to 4,940.70. Taiwan's benchmark rose but those in Southeast Asian markets fell.

RISING YEN: The dollar rebounded slightly against Japan's currency but the yen was hovering near its highest level in almost a year and a half. The dollar rose to 108.75 yen after sinking as low as 107.70 in the previous day's trading, which was the weakest since October 2014. As global markets fluctuate, investors are shifting from riskier assets toward safer bets, including the yen, which has been traditionally seen as a haven. However, the yen's strength threatens to undermine Japanese Prime Minister Shinzo Abe's plan to revive Asia's second biggest economy through monetary easing and fiscal stimulus. Analysts are starting to think the government may have to intervene if the yen falls further.

THE QUOTE: "The rise in the value of the yen is worth keeping an eye on," said Shane Oliver, head of investment strategy at AMP Capital in Sydney. He said a stronger yen is bad for Japanese economic growth also might be a sign that global investors are taking less risk in moving around their capital. "The flipside though is that a rising yen is just a normal phenomenon of periods of investor nervousness and in any case the higher the yen goes the greater the pressure on the Bank of Japan to undertake more monetary stimulus."

WALL STREET: Major U.S. benchmarks had their biggest loss in a month and a half as banks and technology companies tumbled. The Dow Jones industrial average fell 1 percent to 17,541.96. The Standard & Poor's 500 index shed 1.2 percent to 2,041.91. The Nasdaq composite index lost 1.5 percent, to 4,848.37.

ENERGY: Benchmark U.S. crude rose 80 cents to $38.07 barrel in electronic trading on the New York Mercantile Exchange. The contract fell 49 cents, or 1.3 percent, to settle at $37.26 per barrel on Thursday. Brent crude, used to price international oils, rose 66 cents to $40.09 a barrel in London.

CURRENCIES: In other foreign exchange trading, the euro slipped to $1.1369 from $1.1376.