April 2, 2014 / 1:54 AM / 4 years ago

Asian shares steady at four-month high on solid U.S. data, yen at 10-week low

TOKYO (Reuters) - Asian shares nudged higher to four-month highs in early trade on Thursday as upbeat U.S. data underpinned risk appetite, leaving the safe-haven yen languishing at 10-week lows.

MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.1 percent .MIAPJ0000PUS to brush a new four-month high. The index has rebounded about 6 percent from a five-week low hit on March 20, supported by receding tensions in Ukraine and hopes China will take steps to stimulate its sagging economy.

Australian shares were up 0.2 percent.

The early cue for investors came from another record-breaking performance on Wall Street, with the S&P 500 closing at an all-time high on Wednesday as markets lapped up another set of solid private-sector jobs and factory orders data.

The data bolstered expectations for a strong U.S. nonfarm payrolls report on Friday and pushed U.S. Treasury yields higher, which in turn kept the dollar well bid.

The yen remained on the backfoot as its safe-haven appeal continued to fade. The dollar traded at 103.86 yen, within striking distance of a 10-week high of 103.935 hit on Wednesday.

Pedestrians holding umbrellas walk past an electronic board showing stock prices outside a brokerage in Tokyo March 20, 2014. REUTERS/Yuya Shino

The outlook for the Japanese currency remains weak. It is expected to lose ground as persistently low inflation and an economy hurt by a sales tax is likely to force the Bank of Japan to ramp up its own stimulus just as the Federal Reserve winds down its own.

The euro was little changed at $1.3767 against the dollar ahead of an European Central Bank policy meeting later in the session.

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The single currency plumbed a one-month low of $1.3704 last week amid heightened speculation the ECB would ease.

“The failure to act could trigger another wave of euro buying, similar to last month,” currency strategists at Brown Brothers Harriman wrote in a note to clients.

“On the other hand, if the ECB does not ease, the market could ease for them by taking the euro lower,” they added.

In the commodities markets, gold remained firm after posting its biggest gain in three weeks on Wednesday on bargain hunting.

Spot bullion traded at $1289.99 an ounce, not far off Wednesday’s session high of $1,294.60. <GOL/>

Editing by Shri Navaratnam

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