Nikkei edges down as selling in exporters offsets U.S. Fed hopes
* Nikkei erases opening gains on selling in exporters * Market cautious about uncertainty in Europe despite positive local factors - analyst By Ayai Tomisawa TOKYO, Feb 27 (Reuters) - Japan's Nikkei share average edged down on Wednesday, erasing earlier gains as selling in exporters partially offset hopes for continuing U.S. Federal Reserve stimulus. The Nikkei dropped 0.4 percent to 11,356.06 after opening a tad higher. The index fell 2.3 percent on Tuesday on concerns an inconclusive election in Italy could reignite the euro zone debt crisis, moving away from a 53-month high of 11,662.52 touched on Monday. Analysts said trading may remain choppy as sentiment is divided between bulls who want to chase the market higher on ongoing hopes for monetary easing and those who are wary of the uncertainty in Europe. "The Japanese market has been outperforming its global peers since the beginning of this year. Although a weaker yen has served as a tailwind to Japanese stocks, we were reminded this week that the yen can still be bought as a safe haven currency when fears emerged on European debt issues," said a strategist at a European asset management firm. The dollar last traded at 92.13 yen, up from a one-month low of 90.85 touched on Monday on worries that the political deadlock in Italy could cause further instability in debt-stricken Europe. "If the dollar holds above 90 yen, the market may not fall sharply from the current line," the strategist said. The Nikkei has climbed 9.5 percent this year, while the Standard & Poor's 500 Index has gained 5.0 percent and the FTSEurofirst-300 index of top European shares has only added 1.4 percent. While Japanese shares were supported by hopes the government will nominate Asian Development Bank President Haruhiko Kuroda, an advocate of monetary easing as its next central bank chief, a correction may continue if the dollar hovers around the 92 yen-line, market observers said. The yen, which has declined about 20 percent against the dollar since November on Prime Minister Shinzo Abe's bold reflationary policies, skidded to a 33-month low on Monday, with the dollar reaching 94.77 yen. On Wednesday, exporters lost ground, with Toyota Motor Corp dropping 0.7 percent, Honda Motor Co shedding 0.9 percent and Nikon Corp falling 0.8 percent. The broader Topix dropped 0.7 percent to 960.43, erasing earlier gains. "Even if there are negative factors from overseas continuing to hurt sentiment, the Nikkei should be supported above its 25-day moving average (of 11,170) for the time being," said Yutaka Miura, a senior technical analyst at Mizuho Securities. U.S. stocks climbed as Federal Reserve Chairman Ben Bernanke strongly defended the Fed's bond-buying stimulus, easing worries that policymakers might be getting cold feet about continuing the extraordinary measures to support the economy. In Europe, a closely watched gauge of European stock market volatility hit a 2013 high after the muddy election outcome in Italy raised fresh concern about the outlook for the euro zone's debt crisis.
- White House reverses, says Obama met uncle and lived with him during law school
- South Africans, some fearful, wake to life without Mandela |
- U.S. television, Twitter, alive with new version of 'Sound of Music'
- RPT-UPDATE 1-Ford leans on global Mustang to burnish overseas image
- Ford leans on global Mustang to burnish overseas image