* Rise in equities, last week's upbeat data buoy cross/yen
* Signs China share slide may be abating also lend support
* Dlr/yen resistance on weekly Ichimoku charts near Y95.50
By Masayuki Kitano
TOKYO, Aug 24 (Reuters) - The yen was broadly lower on Monday
as optimism about the world economy saw investors increase bets
on currencies linked to global growth and higher yields, such as
the Australian and New Zealand dollars.
The yen has been on the defensive after data on Friday showed
U.S. existing-home sales rose in July for a fourth straight
month, and due to upbeat comments on the global economy from
Federal Reserve Chairman Ben Bernanke. []
[]
Such factors helped lift the U.S. Standard & Poor's 500 Index
<.SPX> to a 10-month intraday high on Friday.
The low-yielding yen tends to fall against higher-yielding
currencies when equities rise or economic data strengthen hopes
for a recovery in the global economy.
Signs of some stabilisation in Chinese equities were another
supportive factor for higher-yielding currencies against the yen,
said Masashi Hashimoto, senior analyst for Bank of
Tokyo-Mitsubishi UFJ.
"There is a sense that falls in Chinese shares may be
abating, and that seems to be a significant factor," he said.
Chinese shares edged up 0.6 percent <>, after turning
negative earlier. Their moves were relatively mild compared with
a recent bout of volatility that has caught the attention of
currency traders.
Some market players, however, say the currency market's focus
on Chinese shares may soon start to fade, given that major stock
markets have been firm despite the sharp pullback in Chinese
equities over the past several weeks.
"The market's risk-taking will likely continue switching on
and off along with the economic environment, but range-trading is
expected to stay," said a trader at a Japanese securities firm.
The Australian dollar rose 0.4 percent to 79.40 yen
<AUDJPY=R> and the New Zealand dollar edged up 0.4 percent to
64.88 yen <NZDJPY=R>.
The dollar rose 0.4 percent from late U.S. trading on Friday
to 94.81 yen <JPY=>, pulling away from a one-month low of 93.42
yen hit on trading platform EBS on Friday.
DOLLAR ABOVE DAILY CLOUD
With its rise on Monday, the dollar has clawed above
resistance at the bottom of the cloud on daily Ichimoku charts.
But Bank of Tokyo-Mitsubishi UFJ's Hashimoto said it was too
early to draw any conclusions, saying the dollar's moves over the
entire day need to be watched.
In addition, on weekly Ichimoku charts, the dollar faces
resistance at levels around 95.50 yen, making it unlikely that
the greenback will rise towards levels such as 98 yen to 99 yen
this week, he said.
The euro held firm after a a euro zone service sector and
manufacturing survey on Friday showed more improvement than
expected. []
The euro was steady against the dollar to $1.4328 <EUR=> and
rose 0.5 percent against the yen to 135.86 yen <EURJPY=R>.
U.S. Federal Reserve Chairman Ben Bernanke said on Friday
that the global economy appears to be on the mend after a deep
downturn, but added that the recovery is likely to be sluggish
and risks remain.
"Bernanke's comments suggest better conditions for the U.S.
economy and a virtual end for the recession," said Stephen
Roberts, an economist at Nomura Australia. "All the upbeat
comments and better economic data are supporting appetite for
high-yielders."
Despite such factors, gains in higher-yielding currencies
against the yen may be limited in the near-term, said a trader
for a major Japanese bank.
"It is not a situation to become pessimistic, but optimism
has been factored in rather sufficiently, so it is hard to chase
them higher," said a trader for a major Japanese bank, referring
to the outlook for yen crosses.
The market will be eyeing U.S. consumer data this week for
incentives, traders said.
The Conference Board will release its August consumer
confidence index on Tuesday and Reuters/University of Michigan
will report on its late August snapshot on consumer sentiment on
Friday.
U.S. housing market data and revised second-quarter gross
domestic product are also slated for this week.
(Additional reporting by Anirban Nag in SYDNEY and Kaori Kaneko
in TOKYO; Editing by Chris Gallagher)
