Asian Shares, Euro Gain After Greek Deal

  on November 26 2012 9:38 PM

 

The euro hit a one-month high Tuesday and Asian shares climbed for a seventh straight day after a Greek debt relief deal was announced.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent to its highest level in more than two weeks. Australian and South Korean shares both gained 0.5 percent, Reuters reported.

"Although somewhat anticipated by the market, the successful agreement over Greece's emergency aid is expected to be an upside influence," Um Tae-woong, an analyst at Bookook Securities, told Reuters.

But Japan's Nikkei stock average edged 0.2 percent lower after hitting a seven-month closing high on Monday. The benchmark has climbed more than 8 percent in two weeks as the yen has weakened on expectations of easier monetary policy with the likely advent of new government after elections.

The euro gained about 0.3 percent to $1.3010, its highest level since Oct. 31, on the Greek news.

Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo, cautioned that the euro still faced downside risks as the latest agreement does not offer a fundamental resolution to the euro zone's debt crisis.

"The euro gained but the rise is small, and it's unlikely that it will climb further, with big funds winding down their positions ahead of the year-end. Any rise will be countered by selling to cap the euro's upside," Maeba said.

The dollar was down 0.1 percent against the yen at 81.98 yen. Traders said some investors unwound long positions in the dollar built up in recent weeks on expectations that a new government for Japan, which is likely to be installed after next month's election, will pressure the central bank to pursue aggressive monetary easing.

The dollar was also down 0.2 percent against a basket of key currencies, helping to underpin dollar-based commodities.

U.S. crude futures inched up 0.1 percent to $87.83 a barrel.

 

 

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