AGL 41.50 Increased By ▲ 2.96 (7.68%)
AIRLINK 128.00 Decreased By ▼ -1.50 (-1.16%)
BOP 6.26 Increased By ▲ 0.65 (11.59%)
CNERGY 4.13 Increased By ▲ 0.27 (6.99%)
DCL 8.44 Decreased By ▼ -0.29 (-3.32%)
DFML 40.69 Decreased By ▼ -1.07 (-2.56%)
DGKC 87.90 Decreased By ▼ -0.40 (-0.45%)
FCCL 34.10 Decreased By ▼ -0.90 (-2.57%)
FFBL 66.33 Decreased By ▼ -1.02 (-1.51%)
FFL 10.56 Decreased By ▼ -0.05 (-0.47%)
HUBC 108.70 Decreased By ▼ -0.06 (-0.06%)
HUMNL 14.46 Decreased By ▼ -0.20 (-1.36%)
KEL 4.65 Decreased By ▼ -0.10 (-2.11%)
KOSM 7.33 Increased By ▲ 0.38 (5.47%)
MLCF 42.72 Increased By ▲ 1.07 (2.57%)
NBP 60.84 Increased By ▲ 1.24 (2.08%)
OGDC 178.97 Decreased By ▼ -4.03 (-2.2%)
PAEL 25.70 Decreased By ▼ -0.55 (-2.1%)
PIBTL 6.06 Increased By ▲ 0.09 (1.51%)
PPL 146.15 Decreased By ▼ -0.55 (-0.37%)
PRL 24.91 Increased By ▲ 1.30 (5.51%)
PTC 16.14 Decreased By ▼ -0.42 (-2.54%)
SEARL 70.20 Increased By ▲ 1.90 (2.78%)
TELE 7.22 Decreased By ▼ -0.01 (-0.14%)
TOMCL 36.20 Increased By ▲ 0.25 (0.7%)
TPLP 7.84 Decreased By ▼ -0.01 (-0.13%)
TREET 15.59 Increased By ▲ 1.39 (9.79%)
TRG 50.36 Decreased By ▼ -0.09 (-0.18%)
UNITY 26.90 Increased By ▲ 0.15 (0.56%)
WTL 1.24 Increased By ▲ 0.03 (2.48%)
BR100 9,795 Decreased By -11.1 (-0.11%)
BR30 29,647 Decreased By -31.2 (-0.1%)
KSE100 92,021 Decreased By -282.9 (-0.31%)
KSE30 28,665 Decreased By -175.5 (-0.61%)

The yen pared gains against the euro and sterling on Friday as Tokyo shares bounced off earlier lows in a volatile session. The yen had risen earlier as Tokyo shares fell by more than 7 percent at one point, but trimmed its gains when the Nikkei recovered some ground to finish 3.6 percent lower.
Share prices are regarded as a barometer of investors' risk appetite, and their decline can trigger an unwinding of carry trades, which involve selling low-yielding currencies like the yen to invest in higher-yielding currencies and assets. Market players said worries about the global economy were likely to continue to support the yen.
"The lingering concerns about the financial system and worries about the economic outlook give investors no choice but to reduce their risk tolerance. It is not yet an environment to buy stocks," said Yousuke Hosokawa, senior manager at treasury department, Chuo Mitsui Trust & Banking.
Market expectations for the ECB and the Bank of England to lower interest rates further after their rate cuts on Thursday gave the yen support, market players said. The ECB cut rates by 50 basis points to 3.25 percent on Thursday and signalled another cut is possible next month, while the BoE slashed rates by 150 basis points to 3.0 percent, with economists saying more rate cuts would follow. The euro dipped around 0.1 percent against the yen from late US trading on Thursday to 124.06 yen after falling to around 122.50 yen earlier.
Sterling shed its losses against the yen and rose 0.1 percent 152.71 yen, well off its intraday lows near 150.30 yen. The dollar fell 0.3 percent to 97.44 yen. "The yen tends to attract buying because of the weakness in economies around the world," said Takahide Nagasaki, chief foreign exchange strategist for Daiwa Securities SMBC.
Unless the global economy improves, it is hard to expect investors to actively sell the low-yielding yen to invest elsewhere, Nagasaki said. Highlighting the global economy's woes, the International Monetary Fund said on Thursday that the world's developed economies were headed for the first full-year contraction since World War II in 2009.
While rate cuts typically weaken a currency's appeal, market players said aggressive monetary easing such as the Bank of England's steep rate cut could also be viewed as a proactive effort to boost growth and have a positive impact.
The euro and sterling reversed course after falling against the dollar earlier, with the euro rising 0.3 percent to $1.2736 and sterling rising 0.5 percent to $1.5677 ahead of the release of US jobs data later on Friday. The US employment data is likely to show that job cuts hit a five-year high of 200,000 in October, according to a Reuters poll, and unemployment jumped to 6.3 percent in October from 6.1 percent.

Copyright Reuters, 2008

Comments

Comments are closed.