Yen Weakens Pushing the Nikkei Higher

Japan’s financial markets traded higher as most of Asia extended gains from Monday. Investors are showing relief over Brexit concerns and a weakening in the Japanese Yen pushed the Nikkei higher after opening lower.

The Nikkei 225 was up over 0.5 percent by mid-morning. The Japanese benchmark had open over one percent lower as the yen opened strong. In early trading, yen opened at 103.57 against the Dollar. By 1120 HK time, the yen had weakened to around ¥104 and by the afternoon the yen was trading around 104.70. Major exporters were mixed. Toyota was flat and Nissan fell while shares of Sony traded over one percent higher.

In Korea, the Kospi Index was a bit lower while the Australian ASX 200 was higher thanks to strength in the financials sub-index. The major Australian banks like ANZ and Commonwealth Bank were higher on the day. The other two Big 4 banks were higher as well.

In China, the headline stock bourses were slightly higher to flat on the day and in Hong Kong, stocks were up 0.3 percent.

Brexit Vote will Impact Asia and the Yen

Asian markets seem to have a myopic focus this week. Traders are focusing on the June 23 referendum in the United Kingdom to determine if the UK will leave the European Union (EU). Polls are showing the “remain” camp gaining some ground, but one YouGov poll, widely watched, showed the leave camp gaining traction. This caused the British Pound to see saw this morning. From gains to losses to closing pretty much flat at the end of the Asian session.

By 1130 HK time, the Sterling Dollar was trading near $1.466, up from $1.40 from Friday’s close. It cannot be said enough, that the British Pound and other Forex pairs, including the Japanese Yen will see saw on volatility until the Brexit Vote on June 23. Investors will be eyeing poll data until the vote.