Shares, euro muted after rally on euro zone hopes

November 29, 2011 05:27
1 minute read.

TOKYO - Asian shares and the euro consolidated from the previous day's rally on Tuesday, as investors cautiously wait for European policy makers to outline details of how they will leverage their bailout fund so it can help Italy or Spain should they need aid.

MSCI's broadest index of Asia Pacific shares outside Japan rose 0.3 percent, after jumping more than 2 percent on Monday, while Japan's Nikkei was up 0.8 percent, moving further away from two-and-a-half year lows hit last week.

Markets shrugged off more news on rating agencies, including a French media report citing several sources as saying Standard & Poor's could change the outlook of France's top-notch rating to "negative" within the next 10 days.

"Let's bear in mind we had a strong rise yesterday ahead of the moves in Europe and the US so to some extend this buying momentum was led out of Asia yesterday, so we are not following as hard today," said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

Euro zone finance ministers will meet later on Tuesday with detailed operational rules for the region's bailout fund, the European Financial Stability Facility (EFSF), ready for approval, paving the way for the 440 billion euro facility to draw cash from investors.

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