Reuters: Most Read Articles: Dollar, Asian shares inch lower on Fed QE expectations

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Dollar, Asian shares inch lower on Fed QE expectations Aug 14th 2013, 04:13 1 of 5. A pedestrian holding an umbrella walks past a stock quotation board displaying various stock prices outside a brokerage in Tokyo July 29, 2013. Credit: Reuters/Yuya Shino By Lisa Twaronite TOKYO | Wed Aug 14, 2013 12:13am EDT TOKYO (Reuters) - The dollar succumbed to profit-taking in Asian trade on Wednesday and Asian shares drifted lower, though moves were small after U.S. retail sales data reinforced expectations that the U.S. Federal Reserve will soon pare its stimulus program. The dollar bought 98.06 yen, down about 0.2 percent and moving back toward a seven-week low of 95.810 hit last week as investors locked in gains its sharp rise over the last two days. "The dollar looks firm on the whole but it is capped by Japanese exporters' offers. Flows are limited and there's no follow-through buying in Asia," said Takahiro Suzuki, vice- president of forex at Nomura Securities. Against a basket of major currencies, the dollar .DXY dipped slightly. U.S. retail sales excluding cars, gasoline and building materials rose 0.5 percent in July, the largest increase since December, reinforcing expectations the U.S. Federal Reserve could soon cut back quantitative easing. Yields on benchmark U.S. 10-year Treasuries inched down in Asia after rising to their highest in nearly two years on Tuesday, as investors prepared for a tapering of the Fed's $85 billion-a-month bond buying, perhaps as soon as September. Atlanta Fed President Dennis Lockhart said it was too early to detail plans for a tapering, but did not rule out the possibility of it starting next month. His suggestion it would neither be sudden or drastic boosted sentiment in U.S. stock markets that carried into Asian trade. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was slightly lower, while Japan's benchmark Nikkei stock average .N225 erased early gains in line with a stronger yen, shedding 0.7 percent. The Korea Composite Stock Price Index (KOSPI) .KS11 edged up. European indicators also painted a brighter picture. Germany's ZEW economic sentiment survey was upbeat and euro zone industrial output rose, while UK house prices increased at their fastest pace in seven years. "The U.S. and European data offered evidence of an improving global economy, although they were not enough to provide a clear direction for the market, it will be enough to give it a push," said Ko Seung-hee, a market analyst at SK Securities in Seoul. Data due on Wednesday is expected to show that in the June quarter the euro zone economy moved out of its longest recession, eking out growth of 0.2 percent. In commodities markets, copper edged down to$7,273.25 a ton. Gold wavered between positive and negative territory after slipping on the U.S. retail sales data and was last at $1,322.51 per ounce. Brent crude prices slipped 0.5 percent to $109.27 a barrel. The Hong Kong Exchange (0388.HK) suspended morning trade on Wednesday as Typhoon Utor approached. (Additional reporting by Hideyuki Sano in Tokyo and Jungmin Jang in Seoul; Editing by John Mair and Eric Meijer) Link this Share this Digg this Email Reprints

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