Asian shares down, Apple results weigh, China data eyed
0.4 percent after falling to a three-week closing low on Tuesday, as investors booked profits from the market's recent rally that was driven by a weak yen.
Yen buying slowed, although the currency remained steady after the Bank of Japan's latest policy easing steps on Tuesday failed to provide immediate stimulus as expected by some investors. The BOJ pledged to achieve a 2 percent inflation target and promised to start open-ended asset buying from 2014.
The dollar eased 0.1 percent to 88.53 yen while the euro was down 0.2 percent to 117.77 yen. The yen is still down 12 percent from its mid-November levels, when markets began pricing in strong monetary accommodation from the BOJ.
Many market players believe the yen's weakness will persist due to widespread expectations the BOJ will continue pursuing aggressive monetary easing policies to beat the country's stubborn deflation.
"The BOJ decision probably isn't a big deal in a sense that the new BOJ regime after (Governor Masaaki) Shirakawa is expected to do everything and anything available, so after profit taking, it's a good opportunity to re-enter the 'Abe trade' because it's all about expectations," said Shogo Fujita, chief Japanese bond strategist at Bank of America in Tokyo.
The "Abe trade" refers to investors betting on a weakening yen and rising Japanese equities on perception Prime Minister Shinzo Abe will pursue aggressive fiscal and monetary policies to pull Japan out of deflation and economic stagnation.
Data on Thursday confirming a deteriorating Japanese trade balance also encouraged yen selling, traders said.
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