Monday, May 27, 2013

Asian stocks still shaky as Nikkei slides 3 percent

Japan's Nikkei index slid more than three percent on Monday, extending last week's severe volatility and causing investors to worry that a bout of profit-taking had turned into lasting doubt about the growth and riskiness of markets.

Last week's shakeout of equity, bond and currency markets was triggered by doubts over how much weakness in the yen Japanese policymakers would tolerate, concerns the U.S. Federal Reserve would reduce monetary stimulus soon, and weakness in Chinese manufacturing data.

But U.S. equities ended off their lows on Friday while U.S. 10-year Treasury yields steadied near 2 percent, suggesting to investors the dollar will resume its rally against the yen and other markets will be calmer.