The largesse, in the form of an expanded loan program to Japan's
commercial banks, was partly offset by action to rein in lending in
China and hawkish comments on rate rises in Australia.
The 3.1 percent gain for Japan's Nikkei contrasted with the rest of
Asia and a 0.4 percent dip in Europe as the FTSEurofirst 300
consolidated after rising in eight of the last nine sessions.
U.S. stock futures pointed to a mixed open after traders return from
a three-day weekend.
A weak reading of German investor sentiment — on concerns about a
slowing in U.S. economic momentum and uncertainty around the
emerging markets outlook — gave no reason to recover lost ground,
even though think tank ZEW cautioned against a too-pessimistic
reaction to the data.
"Although uncertainties on the current recovery path remain
elevated, we certainly see fewer risks than six months ago or so,"
added Annalisa Piazza, market economist at Newedge Strategy in
The concern about some emerging market capital markets has not,
however, stopped the MSCI World index from grinding back to within
touching distance of the high hit prior to January's emerging
The index is now just 0.5 percent off that peak, helped by a 0.2
percent gain on Tuesday that was buoyed in turn by London-listed
mining heavyweight BHP Billiton, which rose after forecast-beating
"I think on a valuation basis stocks still aren't expensive," said
Matt Basi, head of sales trading at CMC Markets. "There's still
money parked on the sidelines waiting to do a bit of bargain
Those looking for value in the region continue to find support from
recent stronger than expected French and German growth data and
expectations that the European Central Bank will act if economic
conditions deteriorate markedly.
Weighing that up against the weaker ZEW, German Bund futures rose 23
ticks on the day.
Greek bond yields, meanwhile, hovered around their lowest since the
country's debt restructuring as international lenders said they
would return to Athens this week to assess the delivery of economic
[to top of second column]
YEN LOSES GROUND
The big loser from the BoJ action and subsequent bank-led Nikkei
rally was the yen, which lost ground against all of its major
currency peers, with the dollar gaining 0.5 percent to trade just
off its February high.
The Japanese action had helped "reverse the recent dollar/yen bear
trend" said Tom Levinson, currency strategist at ING, adding he
thought 102.85/95 yen resistance would hold for now.
The move also helped the dollar edge higher against a basket of
currencies, while the euro also rose against the yen to post a new
A run of weak U.S. data — most recently manufacturing output and the
last two major payrolls numbers — had put the dollar under pressure
and led to fresh speculation about the likely pace at which U.S.
monetary stimulus will be withdrawn.
After initially weathering a bout of profit-taking, gold slid away
from its near 3-1/2-month peak to hit a session low of $1,315.04 per
More insight on the U.S. Federal Reserve's current thinking is
likely on Wednesday, when it publishes the minutes of its last
(Additional reporting by Joshua Franklin, Marius Zaharia and Anirban
Nag; editing by John Stonestreet)
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