The yen that declined against other major currencies in early Asian deals on Monday recouped its losses in the latter part of the session and advanced further during early European trading. The yen thus rose to a 4-day high against the franc and it recovered from near an 8-week low against the euro, 11-day low against the dollar and a 12-day low against the pound.
The Japanese market ended the trading session today, the first day of the trading week, in positive territory with modest gains, having lifted the benchmark Nikkei 225 index past the psychological 9,500 mark, following the release of stress test results for European banks, which were not so bad as feared earlier. Positive closing on Wall Street on Friday on earnings optimism, and slightly weaker yen against the dollar and the euro lifted market sentiment, while profit taking at late trading session capped gains.
The benchmark Nikkei 225 Index gained 72.70 points, or 0.77%, to finish at 9,504, while the broader Topix index of all First Section issues was up 4.59 points, or 0.55%, to 846.
On the economic front, a report released by the Ministry of Finance revealed that the country saw a merchandise trade surplus of 687.0 billion yen in June, which was roughly in line with analysts expectations for a surplus of 690.9 billion yen for the month.
Data further noted that exports climbed 27.7% on year, topping expectations for a 23.5% annual increase after the 32.1% surge in the previous month. Imports jumped 26.1% on year, slightly above forecasts for a 24.7% annual rise following the 33.4% jump a month earlier.
At 5:00 am ET Monday, the yen rose to a 4-day high of 82.57 against the Swiss franc, compared to an early Asian session low of 83.37. If the yen gains further, it may likely target the 82.3 level. The pair is now worth 82.70.
The yen is currently trading at 112.43 against the euro and 87.17 against the dollar, compared to an early Asian session’s near 8-week low of 113.49 and an 11-day low of 87.73, respectively. The next upside target level for the Japanese currency is seen at 86.3 against the dollar and 111.6 against the euro.
The yen that plunged to an 12-day low of 135.63 against the pound at 12:05 am ET Monday strengthened thereafter. As of now, the pound-yen pair is worth 134.70. On the upside, 134.0 is seen as the next target level for the Japanese currency.
Traders are now likely to focus on the New York session, in which the U.S. new home sales report for June is slated for release at 10:00 am ET.