Asian shares rise, yen at all-time lows

The yen selloff came as the Bank of Japan raised rates to a 30-year high of 0.75 per cent, putting heavy selling pressure on government debt

Asian share markets rose on Monday, while the yen wallowed at all-time lows against the euro and Swiss franc as higher interest rates at home did nothing to deter ‍speculative sellers.

Turnover was sparse in what is a holiday-shortened ​week for some parts of the world but the path of least resistance was higher.

Median forecasts tip annualised growth of 3.2 per cent, due in part to a sharp pullback in imports after a run-up earlier in the year ahead of the introduction of tariffs.

Yet analysts at BofA had some words of caution, noting their measure of investor sentiment had moved into extreme bullish territory at 8.5, often a prelude to a reversal.

Readings above ​8.0 have often preceded pullbacks, with global equities declining a median 2.7 per cent over the following two months, with a 63 per cent hit rate, they wrote in a note.

Sentiment data reinforce the cautionary signal: the Fund Manager Survey shows most bullish sentiment in 3-1/2 years, driven by expectations of rate, tariff, and tax cuts, the said.

For now, the fear of missing out seemed to be greater and S&P 500 futures added another 0.2 per cent, with Nasdaq futures up 0.3 per cent.

Nikkei climbed 1.5 per cent, extending Friday’s bounce as a steep decline in the yen promised to boost export earnings for Japanese corporates.

The yen selloff came as the Bank of Japan raised rates to a 30-year high of 0.75 per cent, putting heavy selling pressure on government debt.

Minutes of the BOJ meeting are due on Wednesday, while the head of the central bank speaks to a Japanese business lobby on Christmas Day.