Yen gets boost from equity mart

Yen gets boost from equity mart

SINGAPORE (Reuters): Gains in Japanese shares helped boost the yen against the dollar and the euro and were the highlight in Asian markets on Tuesday, as most countries were shut for a public holiday.

Aside from Japan, only Australia, New Zealand and Indonesia were open.

With most of Europe also closed for May Day, investors were looking ahead to U.S. trading and the release of the April National Association of Purchasing Management (NAPM) index.

Key in the U.S. data release will be reconfirmation that the U.S. economy may be on its way back from the brink of a recession, as indicated most recently from the release overnight of a surprisingly large 0.5 percent climb in personal income and 0.3 percent gain in personal consumption for March.

Confidence in the new administration of Junichiro Koizumi underpinned the Japanese equity market, with gains led by a jump in Hitachi Ltd.

"Signs the country is fully behind the new leader and that foreigners are warming up to his reform mantra has investors buying a broad range of issues, but keying on strong profits," said Masayoshi Okamoto, a trader at Jujiya Securities.

The Nikkei 225 Index closed up 491.14 points or 3.52 percent at 14,425.46.

The positive tone of the Nikkei gave the yen a mild boost against the dollar and euro in lethargic trading.

The euro's near-term fate hinges more importantly on the NAPM release after being jolted recently by surprisingly strong U.S. economic data, dealers said.

The yen climbed to around 123.15 against the dollar and 109.35 against the euro from 123.49 and 109.50 in late U.S. trading while the euro eased to $0.8875 from $0.8880.

Trading in the other centers that were open was subdued.

Australian stocks were flat as investors await the outcome of the Reserve Bank of Australia's monthly meeting to be announced Wednesday morning.

Trading, which is operated electronically, was unaffected by May Day anti-globalization protests outside stock exchange buildings in Sydney.

The S&P/ASX 200 index closed down 0.02 percent at 3,328.7.

Elsewhere, shares in New Zealand drifted a touch lower. The benchmark NZSE-40 Capital Index closed down 0.38 percent at 2,109.07.

In Southeast Asia, stocks in Jakarta were granted a reprieve as gains in the rupiah helped pushed the equity market higher.

The rupiah climbed to Rp 11,000 from Rp 11,550 as market sentiment improved following a peaceful response to parliament's decision to issue a second censure of President Abdurraham Wahid.

At midday, the Jakarta composite index was up 0.45 percent at 359.86 points.

Elsewhere in the region, all eyes will be on the Philippine financial markets when they reopen Wednesday following continued protests and violence which led to three deaths tied to the arrest of former President Joseph Estrada.