15 January 2013: Nikkei soars on Yen weakness

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Japanese stocks surged to multi-year highs on when Asia opened this morning. Monday the Yen hit a 2-half-year low against the dollar on expectations that the Bank of Japan (BOJ) will undertake bold monetary easing measures. USD/JPY reached 89,67, but has retracted somewhat on the Japanese Minister of Finance comments warning against the consequences of Yen Weakness. The Euro which gained substantially against the green back at the start of the week has stabilized. Euro/USD trades around 1.3350 after reaching 1.3402 early Monday.

The USD/JPY also failed to extend recent gains and test the big number of 90 yen as FED chief Ben Bernanke in a speech Monday night said that US recovery was still fragile and warned that economy was at deadlock over the deficit. In a press conference Monday President Barack Obama as well warned that a refusal from Congress to raise the US debt ceiling would have disastrous consequences on US and global economies and trigger economic chaos.

Spurred by the weak Yen the Japanese Nikkei climbed 1,3 percent, the highest level seen since April 2010, while other Asian stock exchanges were struggling to keep early January gains. The Asian Pacific, MSCI-index, eased 0,2%, after a 0,7% decline in South Korean stocks. Investors in Seoul took profit on earlier gains in the technology sector after reports that Apple had slashed orders of screens and other component on weaker-than expected demand.

Apple lost 3,6 percent in Monday’s trading ending at 501 dollar, 150 dollar down from last September. Apple’s losses had a heavy impact on Nasdaq and the S&P 100 when investors braced for fourth quarter earnings disappointments. The Apple news were somewhat countered by Dell that jumped 13 percent. The result came after reports that the number 3 personal computer maker is in talks with private equity firms to go private. Dell’s gains offset some tech-sector weakness.

The news and a growing sentiment that Apple is slowing down after being a product everybody wanted to have, is adding to investors unease when fourth –quarter earnings kick into high gear during this week. Dow Jones was flat and Nasdaq lost 0,26 percent. The European markets were down for a third straight day. Oil prices are picking up. Brent crude trades at 112 USD a barrel. Gold and Silver are stabile hanging on to gains from Monday.

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