San Francisco Frontiers - Stock markets mostly rise, yen hits 34-year low

The yen dropped to 151.97 to the dollar in Asian trading hours after a top Bank of Japan official indicated that it would press ahead with a loose monetary policy after last week's first interest rate hike since 2007.

The Japanese currency strengthened somewhat to 151.36 in the European session on speculation that officials could step in to support the yen.

The weaker yen helped spur a rally in Tokyo's benchmark Nikkei stocks index as exporters benefited, making it Asia's best performer.

"After hitting its highest since 1990, the yen slackened a bit overnight on the comments but has not budged much and the market will need more," said analyst Neil Wilson at trading firm Finalto.

"Usually in these situations the market will test how far Tokyo is prepared to let it go."

Earlier in the day, BoJ board member Naoki Tamura said officials would not embark on a speedy programme of monetary tightening as they try to nurture an economic recovery while keeping a lid on inflation.

"The handling of monetary policy is extremely important from here on for slow but steady progress in normalisation to fold back the extraordinarily large-scale monetary easing," he said, according to Bloomberg News.

Finance Minister Shunichi Suzuki told reporters the government was "monitoring market movements with a high sense of urgency" and "will take resolute action against excessive moves, without ruling out any options."

- Eyes on inflation -

Elsewhere, Wall Street's main indices rebounded at the open, with investors eyeing Friday's release of the Federal Reserve's preferred gauge of inflation -- the personal consumption expenditures (PCE) index -- and the looming corporate earnings season.

Analysts expect the Fed to start cutting rates in June following hikes aimed at taming soaring consumer prices.

"Many investors are concerned that an uptick on Friday could upend dovish expectations," said David Morrison, senior market analyst at Trade Nation.

The Frankfurt DAX was up in afternoon deals even as leading German economic institutes lowered the 2024 growth forecast for Europe's top economy to 0.1 percent.

Paris was also higher but London fell.

Hong Kong and Shanghai closed more than one percent lower.

- Key figures around 1345 GMT -

New York - Dow: UP 0.8 percent at 39,578.23 points

New York - S&P 500: UP 0.6 percent at 5,232.68

New York - Nasdaq Composite: UP 0.3 percent at 16,365.47

London - FTSE 100: DOWN 0.2 percent at 7,913.56

Paris - CAC 40: UP 0.4 at 8,219.96

Frankfurt - DAX: UP 0.6 percent at 18,488.46

EURO STOXX 50: UP 0.6 percent at 5,091.93

Tokyo - Nikkei 225: UP 0.9 percent at 40,762.73 (close)

Hong Kong - Hang Seng Index: DOWN 1.4 percent at 16,392.84 (close)

Shanghai - Composite: DOWN 1.3 percent at 3,993.14 (close)

Dollar/yen: DOWN at 151.36 yen from 151.53 yen on Monday

Euro/dollar: DOWN at $1.0814 from $1.0833

Pound/dollar: DOWN at $1.2616 from $1.2628

Euro/pound: DOWN at 85.76 pence from 85.78 pence

Brent North Sea Crude: DOWN 0.4 percent at $85.94 per barrel

West Texas Intermediate: DOWN 0.4 percent at $81.33 per barrel

burs-lth/rl

D.Parker--SFF