Nikkei soars on yen weakness, Asian shares cautious
Japanese shares surged to multi-year highs on Tuesday as the yen hit a 2-1/2-year low against the dollar the previous day on rising expectations that strong political pressure will prompt the Bank of Japan to deliver bold monetary easing measures.
Other Asian stock markets struggled, with the MSCI's broadest index of Asia-Pacific shares outside Japan giving up earlier gains to ease 0.2 percent.
The pan-Asian index was dragged down by a 0.7 percent decline in South Korean shares, which took a hit from losses in Apple Inc suppliers after media reports said the iPhone maker had slashed orders of screens and other components on weaker- than-expected demand.
"Investors (in the Seoul market) are taking profits on the technology sector, which rallied for the past couple of months, while snapping up auto shares which have been lacklustre," said Kim Soo-young, an analyst at KB Investment & Securities in Seoul. Tokyo shares were the highlight of the session, with the benchmark Nikkei stock average climbing 1.3 percent to its highest level since late April 2010 as the yen remained on a weakening track, helping to improve earnings prospects for exporters. The Nikkei was in deep "overbought" territory technically, signalling a possible near- erm correction.
"Short-term correction is getting more likely given that bullish sentiment ... has become more widespread," said Yasuo Sakuma, portfolio manager at Bayview Asset Management.
Yen-selling activity eased on Tuesday, however, when Japanese Economics Minister Akira Amari said excessive yen weakness could have a negative impact on people's
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