* Yen firms vs dollar, euro
* Risker assets such as stocks, commodities set to extend
* Assets that have rallied recently remain pressured
By Chikako Mogi
TOKYO, April 16 The yen firmed against the
dollar and the euro early in Asia on Tuesday while riskier
markets were likely to encounter another bout of selling after
investors dumped commodities and stocks overnight on concerns
over slowing growth in China and the U.S.
The dollar fell to a low of 95.67 yen and the euro
also hit a low of 125 yen earlier but the dollar
managed to recoup some of its losses and was last at 97 yen,
while the euro also recovered to 126.55 yen.
"It seems investors will remain ready to sell any risk
assets this session, the way markets tumbled broadly. Assets
with large positions being built up will be squeezed out," said
Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo, noting
that equities had been rallying recently on growth optimism.
"In this light, the yen may firm a bit more given the way
the currency's short positions had built up," he said, adding
that a temporary jump to the 94 level against the dollar could
be possible in volatile conditions.
A U.S. regional manufacturing report on Monday showed the
pace of growth slowed, the latest evidence suggesting the
world's biggest economy lost some steam heading into the second
quarter. The dour U.S. report followed data that showed the
Chinese economy unexpectedly stumbled in the first three months
The MSCI's broadest index of Asia-Pacific shares outside
Japan is likely to extend losses after falling
0.9 percent on Monday, led by a plunge in its materials sector
Japan's Nikkei average is expected to open sharply
lower and may test the key 13,000 mark following the fall in
Wall Street on growth worries.
The dismal global growth data weighed on gold, which dragged
other metals lower as its price plunged to a more than two-year
low, with spot gold shedding as much as 9 percent to as
low as $1,336.04 an ounce.
The price of gold bullion tumbled another $125 per ounce in
its biggest-ever daily loss, as investors liquidated bullish
bets en masse after months of disappointment over the
performance of the precious metal. In percentage terms, Monday's
9 percent loss would be the biggest since 1983.
Brent crude fell towards $100 a barrel, while on Wall Street
stocks dropped more than 2 percent for the worst day since Nov.
7 for the Standard & Poor's 500 index. Silver lost
12 percent at $22.71 an ounce, having fallen as low as $22.56.
Two simultaneous explosions ripped through the crowd at the
finish line of the Boston Marathon on Monday, killing two people
and injuring dozens. U.S. stocks extended their
losses as the news compounded already jittery markets.