Asian markets slip, Tokyo hit by strong yen

HONG KONG: Asian markets slipped in holiday-hit trade Monday as investors were unimpressed by a mild improvement in key economic indicators out of China and Tokyo.

The yen also climbed against the dollar and euro ahead of a Bank of Japan (BoJ) policy meeting this week, while there are lingering concerns about political uncertainty in Italy as well as debt-ravaged Cyprus.

Tokyo slipped 0.92 percent by the break on the back of the stronger yen, Shanghai was off 0.57 percent and Seoul lost 0.27 percent.

Sydney, Hong Kong and Wellington were closed for the Easter break.

The BoJ's closely watched Tankan survey of large Japanese manufacturers for the past three months showed a slight improvement in optimism for the world's number three economy, the first uptick in three quarters.

The survey showed sentiment at minus 8 between January and March, up from minus 12 three months earlier.

The figures represent the percentage of firms saying business conditions are good minus those saying they are bad.

However, the figures were unable to prevent a sell-off in shares and a jump in the yen.

Hideki Matsumura, senior economist at Japan Research Institute, told Dow Jones Newswires: "Sentiment is getting better broadly, but the improvement isn't as strong as expected."

And Tachibana Securities market analyst Kenichi Hirano said the negative reaction "may have resulted from the perception that with the Nikkei having performed so well (gaining 19 percent so far in 2012), general business sentiment should have been at least a little better".

The dollar slipped to 93.95 yen early in Asia, against 94.20 yen in New York trade on Friday, when trade was limited by the Easter holiday.

The euro bought $1.2782 and 120.07 yen compared with $1.2818 and 120.78 yen.