Asian shares retreated from two-month highs today as investors paused to assess whether a US plan to deal with banks’ toxic debt would revive the financial system and help pull the economy out of recession.
Japan’s share market shed nearly 1 per cent as bank stocks such as Mitsubishi UFJ Financial Group, the country’s top lender, took a breather, while the yen edged up as the fall in shares tempered appetite for higher-yielding currencies.
The dollar held steady against the euro after a steep rise the previous day on growing expectations of lower euro zone interest rates, and US President Barack Obama said its strength was a sign of confidence in the US economy.
Second thoughts about the US Treasury’s plan to persuade private firms to help rid banks of up to US$1 trillion (RM3.6 trillion) in toxic assets sent Wall Street lower yesterday, reversing some of the hefty gains made on Monday when the plan was released.[ more ]