Asian markets mostly up, Sydney hits 34-month high

Asian markets mostly up, Sydney hits 34-month high

HONG KONG - Asian markets were mostly higher Wednesday, with Sydney hitting a near three-year high, but Tokyo sank on profit-taking and as the yen picked up strength against the euro and dollar.

The Japanese currency picked up after a Group of Seven statement on Tuesday that said "excessive volatility" in exchange markets hurts financial stability, as they tried to calm talk of currency wars ahead of this week's G20 meeting.

Sydney jumped 1.00 percent and above the 5,000-point mark for the first time since April 2010, while Seoul rose 0.36 percent but Tokyo, which surged on Tuesday, fell 0.26 percent.

Hong Kong, Shanghai and Taipei were closed for public holidays.

The G7 statement was published ahead of Friday's G20 in Moscow, where exchange rates are expected to figure prominently after Japan took steps to boost its economy and exports.

Japan's recent policy of monetary easing - which it has said is aimed at boosting the economy - has fuelled concerns around the world that countries will embark on a round of currency weakening to boost their exports.

But Tokyo on Tuesday rejected claims it was trying to force down the yen, saying the new conservative government's big spending and pressure on the central bank for aggressive easing was designed to stoke growth.

"There is no change in Japan's position," Finance Minister Taro Aso told reporters.

"Japan's new government is carrying out monetary policy and economic policy appropriately in order to pull out of a long-running, deflation-induced downturn. There is nothing more to say."

In early trade the dollar bought 93.27 yen, while the euro was at 125.46 yen, compared with 93.47 yen and 125.75 yen late Tuesday in New York. That compares with 94.05 yen and 125.61 yen in Asia earlier Tuesday.

The euro bought $1.3452 Wednesday morning, compared with $1.3450 in US trade.

Hideyuki Ishiguro, senior strategist at Okasan Securities, said: "The yen may be on the agenda at the G20."

"Stocks are likely to face selling for now," he told Dow Jones Newswires.

Traders in Sydney were bullish thanks to strong corporate earnings from the giant Commonwealth Bank as well as data showing consumer confidence had hit its highest level since December 2010.

Wall Street also provided a healthy lead ahead of President Barack Obama's State of the Union address, in which he was expected to outline plans to kickstart the economy.

The Dow rose 0.34 percent to its best close since October 2007, while the S&P 500 added 0.16 percent to also reach a fresh five-year peak. The Nasdaq slipped 0.17 percent.

Oil prices edged higher, with New York's main contract, light sweet crude for delivery in March, up eight cents to $97.59 a barrel and Brent North Sea crude for March rising one cent to $118.67.

Gold was at $1,652.80 by 0200 GMT, compared with $1,641.90 late Tuesday.

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