By Chikako Mogi
TOKYO, Jan 25 (Reuters) - Asian shares fell on Friday, hurt
by a drop in regional technology stocks, although gains in
Australia and Japan contained overall losses for equities.
The MSCI's broadest index of Asia-Pacific shares outside
Japan slipped 0.7 percent, led by a 1.7 percent
slide in the technology sector. A sharp fall in
tech-heavy markets such as South Korea and Taiwan contributed to
the regional retreat.
Seoul shares tumbled 1.3 percent, weighed by weak
profits for automakers, while tech shares continued to falter as
Samsung Electronics announced cautious spending
plans for the first time since the global financial crisis,
following rival Apple Inc's below-estimate results
announced earlier in the week.
Apple suppliers extended their declines from Thursday,
including Taiwan's Largan Precision, while Samsung
shares fell 2.8 percent.
A rise in copper and steady gold prices helped push
commodity-reliant Australian shares up 0.4 percent to a
fresh 21-month high, marking an eighth straight session of
'The U.S. debt ceiling has been pushed out, Japan is
stimulating their economy and Europe seems to have digested
their debt crisis. There aren't a lot of negatives at the
moment,' said Lonsec senior client adviser Michael Heffernan in
Japan's Nikkei stock average also outperformed its
Asian peers with a 2 percent surge as the yen hit fresh lows
versus the dollar and the euro on expectations Japan will pursue
bold policies to beat deflation and stimulate growth.
'Trading on Japan is gaining momentum among foreign
investors, centering around the dollar/yen, which has dictated
Nikkei's direction,' said Tetsuro Ii, the chief executive of
Commons Asset Management.
The yen's slide after its brief rebound this week bolstered
sentiment for Japanese equities as it lifts earnings prospects
for exporters, ahead of the quarterly earnings season set to
start next week.
The dollar scaled its highest level since June 2010
to reach 90.695 yen early on Friday and the euro rose
to 121.32, its highest since April 2011. Prime Minister Shinzo
Abe's new administration has made clear it wants a weaker yen,
providing investors a reason to short the currency.
The yen has declined sharply since mid-November on
expectations the new government will implement aggressive
monetary easing and huge fiscal spending polices to end decades
of deflation and return Japan to a sustainable growth path.
More than 80 percent of Japanese firms are in favour of
Abe's policy mix, though most also feared Japan would face a
debt crisis within a few years, according to a Reuters poll.
'JPY weakness should continue over the coming year driven by
an expansion of the Bank of Japan's balance sheet relative to
the European Central Bank and the Federal Reserve,' said Kit
Juckes, FX strategist at Societe Generale in a note. 'I don't
know how long the USD/JPY is going to pause at around 90, but a
move to 100 still seems very likely in the longer run.'
Solid data from the United States and Germany after
similarly upbeat manufacturing figures from China lifted world
equity and commodity markets.
The Standard & Poor's 500 Index briefly topped the
symbolic 500 mark for the first time since December 2007 while
European shares hit their 2013 peak.
U.S. factory activity grew the most in nearly two years in
January while a German business survey showed its private sector
expanding at its fastest pace in a year this month.
U.S. crude eased 0.2 percent to $95.78 a barrel and
Brent inched down 0.2 percent to $113.11.
London copper rose 0.2 percent to $8,109 a tonne and
spot gold steadied around $1,667.64 an ounce.
(Editing by Shri Navaratnam)
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