* Asia left rudderless after flat finish on Wall St, mixed
* China's yuan steady for the moment after Tuesday's slide
* Major currencies drift sideways, gold near four-month peak
* Fed Chair Yellen to testify to Senate on Thursday
By Wayne Cole
SYDNEY, Feb 26 Asian share markets struggled to
scrape together some gains on Wednesday following a flat finish
on Wall Street and as concerns over opaque policy moves in China
kept investors on edge amid a drought of major economic data.
Chinese share markets and the yuan stabilised after sharp
falls on Tuesday, with Shanghai adding 0.1 percent.
MSCI's broadest index of Asia-Pacific shares outside Japan
crept ahead by 0.28 percent, while south Korea,
Taiwan and the Philippines were all fractionally firmer.
In Tokyo, the Nikkei 225 pared early losses to be off
0.2 percent, which follows a 1.4 percent gain on Tuesday.
"For the rest of the week, the Nikkei may see directionless
trade and a lack of volume because investors need more catalysts
to take positions," said Masashi Oda, chief investment officer
at Sumitomo Mitsui Trust Bank.
Panasonic Corp broke from the pack and jumped 5
percent on reports the firm was inviting several Japanese
suppliers to join it in investing in a U.S. car battery plant it
plans to build with Tesla Motor Inc TSLA.O.
Economic data from the United States had been too mixed to
offer any lead. A closely watched housing survey showed home
prices rose slightly more than expected in December, though
February consumer confidence fell short of expectations.
The cautious tone in markets was also warranted ahead of
testimony from Federal Reserve Chair Janet Yellen slated for
Thursday, where she is bound to draw questions on the recent
spate of soft U.S. economic news and what it might mean for
The Dow ended Tuesday 0.17 percent lower, while the
S&P 500 lost 0.13 percent a day after touching a record
Yields on 10-year U.S. Treasury notes were steady at 2.71
percent after dipping about 4 basis points
overnight, leaving them roughly in the middle of the recent 2.57
to 2.79 percent trading range.
Gold edged back to $1,340.00 an ounce and away from a
four-month top at $1,343.40.
In currencies, dealers reported scant activity ahead of the
month end and a slate of major global data next week. The dollar
inched up on the yen to 102.33, but could make no headway
on the euro at $1.3742.
The single currency has been corralled in a $1.3685-$1.3773
range for the past six sessions.
After falling sharply on Tuesday, China's yuan was looking
more stable so far on Wednesday. It was quoted at 6.1283 per
dollar, little changed from Tuesday's close.
Dealers suspect the People's Bank of China has engineered
the recent decline in its currency to inject more two-way
volatility into the market and wrong foot speculators that had
amassed huge positions wagering on its continued rise.
The Chinese currency has been a favourite among emerging
market currencies in 2013, gaining nearly 3 percent even as most
of its peers depreciated against the dollar. Most analysts
expect it to appreciate another 2-3 percent this year, but the
change in direction has rattled confidence.
Some analysts believe the PBOC may be preparing the markets
for more reforms.
"Putting such a warning shot over the bows of the FX
community could also be seen as a sensible move ahead of any
possible widening of the CNY's trading band," said Patrick
Perret-Green, an analysts at Australia New Zealand Bank.
ANZ believes the band will be widened to 2 percent from the
current 1 percent within the next couple of months, a move
toward liberalisation that should be seen as a positive step.
Yet he also cautioned that the weakness was not confined to
the yuan and equities. Prices for copper and steel had fallen
sharply while money markets rates were broadly lower, a risk-off
shift that suggested growing worries about the economy.
"So far, the reaction of other global markets has been
remarkably relaxed, if not perverse. It is questionable how long
this can persist."
In oil markets, Brent crude eased 15 cents to
$109.36 a barrel, while U.S. oil lost 21 cents to