* MSCI Asia ex-Japan down 0.2 pct, Nikkei gains 0.6 pct
* Dollar at five-week high vs yen
* Chinese shares underperform
By Chikako Mogi
TOKYO, Aug 20 (Reuters) – Asian shares inched lower on
Monday, taking a break after investor risk appetite had risen on
hopes that Europe’s policymakers will take decisive steps to
tackle the euro zone’s debt crisis in coming weeks.
MSCI’s broadest index of Asia-Pacific shares outside Japan
was down 0.2 percent, pulled lower by Chinese
shares. The index has risen about 1 percent so far in August and
is hovering near a three-month high hit earlier in the month.
Hong Kong shares fell 0.9 percent and Shanghai slid 1
percent after data over the weekend showed home prices
in China rose in July for a second month, spurring profit taking
in the property sector, which has outperformed the broader
market in the year to date.
The state-run Shanghai Securities Journal reported on Monday
that rising housing prices could lead Beijing to impose more
curbs on the sector to control housing inflation, which could
include an expansion of the property tax pilot to include more
cities and raising the pre-sales requirements.
Japan’s Nikkei stock average gained 0.6 percent to a
three-month high, with a weaker yen supporting exporters.
“You do get to a stage where a lot of investors are a little
bit sceptical whether this run will continue,” said IG Markets
analyst Stan Shamu, of Australia’s equities market
,which pulled back from a three-month high as investors took a
breather in the absence of any clear catalyst to push the market
higher.
Both the pan-Asia stock index and the Nikkei hit their 2012
lows in early June, with the recent bouts of rallies inspired by
the European Central Bank hinting at a bond-buying programme to
contain Spain’s surging borrowing costs and backing from
Europe’s paymaster Germany.
On Friday, a record high for Apple Inc shares
boosted U.S. stocks while the Standard & Poor’s 500 Index
stayed near a four-year high, and European shares closed at
13-month highs for their best week in seven years.
“The market is gaining ground on a much more solid footing
compared to the first-quarter liquidity rally and the relative
stability offers more room for further, sustainable gains,” Tong
Yang Securities in a note to clients.
In a sign of easing investor fears, the CBOE VIX volatility
index, which measures expected volatility in the S&P; 500
over the next 30 days, plumbed a five-year low on Friday.
The dollar rose to a fresh five-week high against the yen at
79.660 yen.
Asian credit markets were calm, with the spread on the
iTraxx Asia ex-Japan investment-grade index barely
changed.
Oil rose, with Brent up 0.5 percent to $114.26 a
barrel and U.S. crude up 0.3 percent to $96.27 a barrel.
EUROPE RESUMES BUSINESS
With many European policymakers away on summer holidays,
markets have enjoyed a respite in recent weeks from negative
headlines.
While markets anticipate some conclusive action to calm the
euro zone’s troubled bond markets to be announced at the
European Central Bank’s policy meeting next month, the focus
this week is on a meeting between leaders of Greece and Germany
on Friday.
Senior German politicians already stepped up the pressure on
Greece to stick to its reforms, and made clear that there was no
appetite in the German parliament for a third aid package for
Athens.
Recent polls by Reuters showed that successive debt
bombshells from Greece have so far failed to blow apart the
political bonds that hold it in the euro zone, persuading
growing numbers of economists to conclude that the country has a
future inside the currency union.
The ECB could outline details of its debt-buying programme
at its Sept. 6 meeting to ease pains for Spain, and its economy
minister Luis de Guindos said the ECB must take forceful and
unlimited steps to buy sovereign debt to help Madrid cut its
refinancing costs and remove doubts over the euro zone’s future.
He said the government will study the details of the ECB’s
debt-buying programme before making a decision on applying for
more European aid.
Germany’s weekly Der Spiegel magazine reported on Sunday the
ECB is considering setting yield thresholds for any purchases of
a struggling euro zone country’s bonds.
A survey published on Friday showed U.S. consumer confidence
rose in early August to its highest level in three months while
the Conference Board’s gauge of future U.S. economic activity
improved in July.
With recent solid U.S. data raising uncertainty over whether
the Federal Reserve would take further easing steps, and hopes
in Europe spurred investors to shift less money into bond funds
worldwide last week, fund-tracker EPFR Global said on Friday.
