(MENAFN- AFP) The yen soared Friday after the Bank of Japan only tweaked its stimulus programme, disappointing traders who had expected a huge boost to lift global markets.
Although Tokyo stocks ended higher, with the financial sector cheered that the bank did not cut borrowing costs further into negative territory, most other Asian indices retreated.
European equities diverged, with Frankfurt and Paris lifted by economic growth data, while London slid as oil prices hit three-month lows.
Investors were meanwhile bracing for the outcome of the European Banking Authority's latest round of stress tests on 51 banks across Europe, amid concern over Italy's lenders. The EBA will post its results at 2000 GMT.
On Wall Street, the Dow and S&P 500 dipped at the open of trade, while the tech-heave Nasdaq Composite edged higher.
"US stocks are mixed in early action, with technology issues getting a boost from earnings results from Google, while a much softer-than-expected second quarter domestic GDP report and disappointment from the Bank of Japan's monetary policy decision may be weighing on sentiment," said analysts at Charles Schwab.
The US economy grew at a modest 1.2 percent in the second quarter of this year, according to Commerce Department data, falling well below analysts' expectations of 2.6 percent.
Growth in the first quarter of 2016 was also revised downward, from 1.1 percent to 0.8 percent,
In Asia on Friday, Bank of Japan policymakers said only that they would boost its exposure to riskier investments, leaving its massive 80 trillion yen annual asset-buying programme unchanged.
The news came despite weeks of fervent speculation that the BoJ would pump fresh cash into the nation's sluggish economy.
"Markets may be disappointed that the Bank of Japan did not deliver more stimulus overnight ... but financials are clearly relieved that it didn't take interest rates further negative," said analyst Mike van Dulken at traders Accendo Markets.
The news sent the dollar tumbling in Asian deals to below 103 yen from 104.20 yen earlier in the day, and well off the levels above 107 yen touched last week.
The Nikkei stock index sank almost two percent at one point but bounced back to end 0.6 percent higher.
Japanese officials are under intense pressure to deliver as the fate of Prime Minister Shinzo Abe's faltering bid to reignite the world's number three economy, dubbed Abenomics, looks increasingly gloomy.
The gathering was its first since Britain's shock vote last month to quit the European Union. The referendum result hammered financial markets and sparked a yen rally that is threatening corporate Japan's bottom line -- and fanning concerns about growth.
- Eurozone growth halves -
Back in Europe, official data showed eurozone economic growth halved in the second quarter, with analysts warning that Brexit fallout could harm the economy further later in the year.
The Eurostat statistics agency said economic growth in the 19-nation single currency bloc slowed to 0.3 percent in the April to June period, with stagnation in France largely contributing to the poor data.
This was down from a far more robust expansion of 0.6 percent in the previous quarter.
"It was looking like the (eurozone) region could be in for a real worrying number following the stagnant French figure from earlier in the morning; and in no way is a halving of growth quarter-on-quarter a good thing," Spreadex analyst Connor Campbell told AFP.
"But the region is still seeing some kind of growth -- even if it is much reduced -- leading to the response from the DAX and the CAC.
- Key figures around 1430 GMT -
London - FTSE 100: DOWN 0.3 percent at 6,703.12 points
Frankfurt - DAX 30: UP 0.3 percent at 10,301.97
Paris - CAC 40: UP 0.2 percent at 4,427.99
EURO STOXX 50: UP 0.4 percent at 2,976.88
New York - DOW: DOWN 0.2 percent at 18,423.44
New York - S&P 500: DOWN less than 0.1 percent at 2,169.34
New York - Nasdaq: UP 0.1 percent at 5,162.37
Tokyo - Nikkei 225: UP 0.6 percent at 16,569.77 (close)
Hong Kong - Hang Seng: DOWN 1.3 percent at 21,891.37 (close)
Shanghai - Composite: DOWN 0.5 percent at 2,979.34 (close)
Euro/dollar: UP at $1.1162 from $1.1076
Pound/dollar: UP at $1.3229 from $1.3166
Dollar/yen: DOWN at 102.85 yen from 105.32 yen
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.