Dollar rises as Asian markets tread water

GMT 05:17 2015 Thursday ,23 July

Arab Today, arab today Dollar rises as Asian markets tread water

Share prices board in Tokyo
Hong Kong - AFP

The dollar ticked higher against the yen in Asian trade Thursday as investors position for an expected US rate hike, pushing Japanese stocks higher while most other regional markets were mixed.

The euro got a lift after Greece took another step closer to securing a bailout, while Shanghai extended its latest rally to a sixth day as mainland markets slowly recover from a month-long plunge that wiped trillions off valuations.

Tokyo rose 0.41 percent, Hong Kong added 0.25 percent and Shanghai gained 0.10 percent, while Seoul dipped 0.15 percent and Sydney was flat.

After Wednesday's losses, the greenback resumed its upward trajectory following a strong batch of housing data that reinforces expectations that the Federal Reserve will lift rates soon.

Official figures showed sales of existing homes in the US surged in June to their highest level in more than eight years and prices hit a record high.

"It's not determined yet whether the US rate hikes will be in September or December, but the housing data strengthens the case for a September hike a little," Mitsushige Akino, executive officer at Ichiyoshi Asset Management Co., told Bloomberg News.

In early Japanese trade the dollar bought 124.07 yen against 123.96 yen in New York.

The euro advanced after Greek lawmakers passed a second batch of tough austerity measures demanded by creditors to open up negotiations on a new bailout.

The single currency fetched $1.0943 and 135.77 yen, against $1.0926 and 135.44 yen.

Traders are awaiting a Fed policy meeting next week to find out what its plans are for monetary policy.

Despite the upbeat data, US stocks slid for a second day after disappointing earnings from Apple and Microsoft raised concerns about the current reporting season, denting the broader market.

The Dow fell 0.38 percent, the S&P 500 dropped 0.24 percent and the Nasdaq sank 0.70 percent.

A stronger dollar is also putting downward pressure on commodity prices.

Oil prices were mixed Thursday but continue to struggle after a US energy report showed stockpiles increasing, indicating soft demand, while the stronger dollar also makes it more expensive for buyers using weaker currencies.

US benchmark West Texas Intermediate for delivery in September was up eight cents to $49.27 and Brent crude for September fell six cents to $56.07 in morning Asian trade.

And gold was sitting at five-year lows, with the expected US rate hike attracting investors away from the safe-haven metal in search of better returns.

Bullion fetched $1,094.58 an ounce compared with $1,093.46 late Wednesday.

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