* Dollar drops against yen as BoJ says more stimulus not
* Wall Street rebounds, led by social media and Internet
* U.S. Treasuries prices dip ahead of note sale
(Updates prices, activity in bond market)
By Michael Connor
NEW YORK, April 8 The dollar and euro fell
sharply against the yen on Tuesday as hopes for additional
stimulus out of Japan faded, while world equity markets were
relatively stable after three days of losses.
Wall Street clawed back some ground after three days of
steep losses. U.S. Treasury prices were generally flat after
For the second time this week, policymakers from a major
central bank cut short expectations for additional stimulus,
with the governor of the Bank of Japan, Haruhiko Kuroda, saying
Tuesday that there was no need for more monetary support to
Investors had expected the BoJ to indicate more support was
forthcoming, and the yen rose as the Bank of Japan kept
its policy steady.
"You had a lot of players who were short the yen, and Kuroda
dashed the hopes of stimulus," said Richard Scalone, co-head of
foreign exchange at TJM Brokerage in Chicago.
The comments from the Bank of Japan followed remarks on
Monday by several policymakers from the European Central Bank
that they would increase policy easing only if they thought the
inflation outlook had deteriorated sharply.
Against the yen, the dollar lost 0.8 percent, to hit a
10-day low of 102.23 yen, while the euro shed 0.5 percent
to 141.01 yen, the lowest level in more than a week.
The yen had been under pressure in recent days on
expectations that a rise in Japan's sales tax, which took effect
in at the start of April, would hurt consumption, and that the
BoJ might ease policy in coming months to soften the blow.
The dollar index, which measures the dollar against a
basket of six major currencies, was off 0.57 percent and near
lows last seen on March 19.
Wall Street, after a wave of selling over three days that
caused the biggest drop for the tech-focused Nasdaq
since late 2011 and the biggest drop in two months for the S&P
500 and Dow Jones indexes, rose on Tuesday, led by
the tech sector.
The Dow Jones industrial average rose 28.83 points or
0.18 percent, to 16,274.7, the S&P 500 gained 6.14 points
or 0.33 percent, to 1,851.18 and the Nasdaq Composite
added 34.175 points or 0.84 percent, to 4,113.927.
Investors bought beaten-down shares of social media and
Internet companies. The day's biggest gainers included
Amazon.com Inc, up 3.0 percent at $327.44, Yahoo! Inc
>YHOO.O>,,up 3.5 percent at $35.22, and LinkedIn Corp,
up 4.7 percent to $167.04.
The Global X social media index rose 3.0 percent to
The U.S. earnings season gets under way this week. Aluminum
producer Alcoa Inc will report after the market close on
Tuesday. Financials JPMorgan Chase & Co and Wells Fargo
& Co will issue results on Friday.
Global stock markets were mixed, with the MSCI world equity
index up 0.07 percent.
U.S. Treasuries prices, after two days of strong gains, were
flat ahead of a $30 billion three-year note sale, the first of
$64 billion in new coupon-bearing supply this week.
Investors turned their attention to the impending supply and
considered whether the yields would be attractive enough in the
auctions after the recent rally.
Benchmark 10-year notes were last up 2/32 in
price to yield 2.699 percent. Thirty-year bonds US30YT=RR rose
4/32 in price to yield 3.555 percent.
Rising tensions in Ukraine may temper investor appetite for
risk. Police detained 70 people occupying a regional
administration building in eastern Ukraine overnight, but
pro-Moscow protesters held out in a standoff in two other
cities, in what Kiev called a Russian-led plan to divide the
World financial powers are set to gather this week at the
International Monetary Fund's spring meeting. Washington engaged
in some pre-meeting jockeying with China, warning Beijing that
recent depreciation of the Chinese currency could raise "serious
Much of the focus is likely to concentrate on Russia's moves
into Ukraine, which have been met with the threat of stronger
sanctions from the West, though Russian stocks and the
rouble seemed largely unconcerned on Tuesday.
European shares and bonds fell. London's top share
index hit a two-week low, and Paris and Frankfurt
were off about 0.75 percent.
Asian stocks managed to shrug off Monday's gloom from Wall
Street. Chinese shares, particularly those of banks,
rose on stimulus hopes and helped to take MSCI's benchmark
emerging market index to its highest level since
Japan's Nikkei fell 1.4 percent on concern over
global tech stocks.
In commodity markets, safe-haven gold was trading
around two-week highs, up about 1 percent from the previous
session at $1,309.70 an ounce.
U.S. crude for May gained 0.6 percent to $101.01 a
barrel, pushed up by the renewed tensions over Ukraine, a major
supply route for Russian gas to Europe. But the rise was capped
by expectations U.S. crude oil stocks were building up.
Brent rose 0.2 percent to $106.01 a barrel.
(Reporting by Michael Connor in New York; additional reporting
by Marc Jones in London; editing by Leslie Adler)