Asia stocks struggle, yen gains
HONG KONG (Reuters) - Asian stocks edged up slightly on Tuesday but struggled after a slide the previous day, while the yen held gains against higher-yielding currencies as investors doubt the speed of the global economy's recovery.
A bleak U.S. jobs report last week has prompted portfolio managers to reassess how quickly economies around the world can return to growth after the deep recession, spurring a pull-back in shares and currencies such as the Australian dollar.
"Optimism previously shown towards the economy is being scaled back and this is putting a lid on the market. Last week's U.S. employment numbers were a hint that perhaps the market had become over-optimistic," said Takahiko Murai, general manager of equities at Nozomi Securities in Tokyo.
But regional markets have held up as some early news on quarterly earnings showed technology companies faring well.
Taiwan's benchmark TAIEX index gained 1 percent, thanks to a 3 percent jump in shares of smartphone maker HTC (2498.TW) after the company reported a better-than-expected second-quarter profit.
South Korea's KOSPI edged up 0.2 percent a day after Samsung Electronics (005930.KS), the world's top maker of memory chips and flat screen TVs, forecast second-quarter earnings well above forecasts, giving the broader market a boost.
The yen held near a five-week peak against sterling and the New Zealand dollar as market players have cut holdings of currencies that have surged along with stocks. U.S. crude oil prices were up 15 cents a barrel at $64.20 but hovered near a five-week low.
In Japan, investors have poured cash into government bonds on bets that the economy's recovery from recession will be an extended one that could lead to a long stretch of deflation, pushing benchmark yields to a three-month low.
The MSCI index of Asia-Pacific shares outside Japan edged up 0.4 percent, with technology shares the biggest gainers.
Japan's Nikkei share average .N225 dipped 0.2 percent, with exporters under pressure from a firmer yen, while the Shanghai Composite .SSEC shed 0.5 percent after having reached a 13-month high the previous day.
China's economic resilience and splurge of bank lending to boost growth has fuelled the 70 percent rally in the Shanghai Composite so far this year.
Investors were also watching whether Indian markets would extend their slide from Monday after the government's big-spending budget for the coming fiscal year was viewed as disappointing, sparking a 6 percent drop in the SENSEX .BSESN and a spike in bond yields.
DOLLAR STEADIES
The dollar was mostly steady and has held its ground in the past few weeks as riskier assets have stumbled, with the U.S. currency favoured as a safe haven when market players strike a cautious footing.
The dollar was little changed at 95.36 yen, while the euro drifted sideways at $1.3960. Continued...
