Asian markets mixed, caution on US debt, Banks stress tests

FXStreet Team FXStreet

FXstreet.com (Barcelona) - Asian markets are mixed on Friday, with investors reluctant towards risk on concerns about the growing possibilities of debt default in the US, and ahead of the release of Eurozone Banks' stress test results. In currency markets, the Dollar remains trading near week lows.

Japanese Nikkei Index rises 0.3% after bouncing up from a negative opening, the South Korean Kospi Index adds 0.3%, and the Chinese Shangai Composite Index rises 0.2%. On the negative side, Australian ASX Index eases 0.4%, and the Hong Kong Hang Seng Index Index edges down 0.1%.

Standard & Poor's added pressure to US yesterday, setting its long-term dc"AAA" debt rating on "CreditWatch" with negative implications, following a similar move by Moody's, on the growing possibilities of a default as US congressman fail to reach an agreement to lift the country's debt ceiling.

Risk appetite is expected to remain subdued in Europe with investors focusing on the release of Eurozone Banks' stress tests results, were, according to markets sources 10 to 15 banks, out of 90, might have failed,. Most of them Spanish and German.

Dollar, near weekly lows

EUR/USD recovery from 1.3835 low on Friday, was capped at 1.4280, and the pairs following pullback has been contained above 1.4100, to consolidate in Asia around 1.4150.

GBP/USD bounced sharply fro multi-month lows at 1.5775 on Tuesday, to reach 3-week highs week highs at 1.6195 yesterday, and consolidate afterwards 1.6100 and 1.6175.

USD/JPY was rejected at 81.50 high last week, and the pair plunged this week breaching support level at 79.55/70 area to reach fesesh 4-month lows at 78.45 yesterday, and consolidate afterwards within a 40 pips range around 79.00.

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