Tokyo stocks were flat in cautious trade as the euro remained persistently weak despite a pledge from EU leaders of continued support for debt-wracked Greece.

Tokyo stocks were flat in cautious trade Thursday as the euro remained persistently weak despite a pledge from EU leaders of continued support for debt-wracked Greece.

The Nikkei 225 index at the Tokyo Stock Exchange, which tumbled 1.98 percent the previous day, edged up 0.08 percent or 6.78 points to close at 8,563.38.

The Topix index of all first-section issues gained 0.09 percent or 0.68 points to 722.25.

“Wednesday's big sell-off allowed many players to unwind their short positions. The market is showing all the signs of a lack of acute broad interest,” said an equity trading director at a foreign brokerage.

“Aside from isolated and/or speculative moves, the mood is cautious with too many risks elsewhere to trade confidently,” he told Dow Jones Newswires.

While the benchmark index ended slightly higher, companies with large exposure to the eurozone fell, with Canon plunging 2.16

percent to 3,160 yen and TDK off 2.00 percent at 3,420 yen.

The euro, which on Wednesday fell below 100 yen for the first time since early February, fetched 99.93 yen in Tokyo afternoon trade against 99.96 in New York.

The dollar was at 79.48 yen against 79.45 yen in New York.

Market players were unmoved by the outcome of the informal European Union summit, which pledged support for debt-ridden Greece.

It was “largely in line with expectations in that EU leaders weren't able to produce any concrete steps,” such as eurozone bonds and a guarantee of bank deposits, said Kazuhiro Takahashi, general manager of investment strategy at Daiwa Securities.

After the summit, European Union president Herman Van Rompuy admitted there had been divisions on the issue of eurobonds, which French President Francois Hollande put forward against resistance from German Chancellor Angela Merkel.

“Ahead of mid-June's so-called 'super-week' of activity, including elections in Greece and France, a US Fed meeting, a G20

summit in Mexico, et cetera, players are very tentative on making major bets,” says an equity trader at a foreign brokerage.

Toyota Motor was unchanged at 3,065 yen after it denied a press report that it was to begin selling cars in India priced at around $6,000 as it looks to boost its share of the country's growing affordable car market.

Nissan Motor fell 1.43 percent to 755 yen after announcing Wednesday it would launch global production of an all-electric van, the e-NV200, as early as next year in Barcelona. - Sapa-AFP

Britain's top shares rose though trade remained cautious after a European summit failed to produce concrete proposals for tackling the region's debt crisis.

Britain's top shares rose on Thursday, clawing back some of the previous session's steep losses, though trade remained cautious after a European summit failed to produce concrete proposals for tackling the region's debt crisis.

Markets rallied earlier in the week on hopes that new proposals would be made at the informal summit, including ways of sparking economic growth and boosting investor confidence.

Thursday's economic data made for grim reading, with Britain falling deeper into recession than first thought in the first quarter after a sharp drop in construction output.

In Germany, the manufacturing sector shrank and business sentiment plummeted in May, heightening concerns about the ability of Europe's largest economy to weather the region's crisis.

Market moves have been fragile, with the UK blue-chip index sinking 2.5 percent on Wednesday to a fresh 2012 closing low, on mounting fears Greece will leave the euro zone, only to recover some of its poise on Thursday as investors bought in on the dips.

The FTSE 100 was up 32.91 points, or 0.6 percent, at 5,299.32 by 11:15 SA time in nervous choppy trade, with the index having surged earlier to a peak of 5,323.63.

“At the moment it's really a question of markets moving on newsflow. Will Greece be leaving the euro zone? If it is, when will it happen? Will it be a good thing or a bad thing?,” Michael Hewson, senior market analyst at CMC Markets, said.

“Nothing else really matters... I think any upside is going to be fairly limited and we're really back into selling into any strength until we get some form of positive policy reaction out of Europe.”

Citigroup said it assumes Greece will leave in early 2013, leading to a sharp currency devaluation and a large drop in economic activity in 2013, with a modest rebound further ahead.

“We believe that sizeable adverse economic and financial contagion to other euro area countries will be unavoidable and this is already happening to an extent,” Citi said in a note.

Miners and energy stocks trimmed back opening gains, with earlier weak manufacturing data from China adding to fears about a demand outlook already muddied by the festering euro zone crisis.

“We are close to a crescendo of fear in relation to the euro zone financial crisis and close to a nadir for confidence in economic growth,” said Andrew Bell, chief executive of Witan, a 1.1-billion pound ($1.7 billion) investment trust.

“The fall in oil prices will be a significant tonic for consumer sentiment by late summer, while the US recovery has broader foundations than in recent years. Equities appear strategically attractive but, as ever, tactically risky.”

As the earnings season draws to an end, a handful of company reports provided some distraction for investors otherwise preoccupied by macroeconomic issues.

United Utilities, Britain's largest listed water group, rose to near the top of the blue-chip leader board, up 1.8 percent after unveiling full-year profits above expectations, while Peroni and Grolsch beer maker SABMiller managed a more modest 0.2 percent rise as it too beat forecasts.

Of 94 percent of European companies that have reported so far, 58 percent have beaten or met expectations, according to Thomson Reuters Starmine data. - Reuters

JSE stocks bounced back in early trade but the local bourse remained vulnerable amid a lack of consensus by EU leaders on how to tackle the risk of Greece exiting the currency bloc and also declining factory orders from China.

JSE stocks bounced back in early trade on Thursday but the local bourse remained vulnerable amid a lack of consensus by EU leaders on how to tackle the risk of Greece exiting the currency bloc and also declining factory orders from China.

The unstable outlook for the euro zone and fears that the crisis could derail the global economy have prompted investors to park money in safe-haven assets such as US and German government bonds, the US dollar or cash.

In their morning report, Absa Capital said that safe-havens continue to thrive as global growth fears and EU debt fears linger.

At 09:24 local time, the JSE all-share index was up 0.69% to 33,114.86 points, with the platinum index adding 1.04%, resources gaining 1.24% and gold counters up 4.12%.

Financials garnered 0.61%, banking stocks lifted 0.78% and industrials were up 0.33%.

The rand was trading at 8.37 to the US dollar, from 8.32 at the JSE's close on Wednesday, while gold was quoted at US$1,559.04 a troy ounce from $1,588.85/oz at the JSE's previous close and platinum was at $1,422.20/oz, from $1,462.70/oz at the previous session.

“The market is volatile right now. It remains uncertain as we continue to see the European crisis unfold. The dollar continued to strengthen against the euro. Resources are doing well and gold was extremely sold off,” said local trader said.

Dow Jones News Wires reported that most Asian markets edged lower Thursday after weak manufacturing data from China and as European leaders failed to produce a breakthrough to the region's economic crisis.

The euro fell to its lowest in two years overnight as a summit in Brussels highlighted differences between European leaders. Worries are growing over a potential Greek exit from the euro zone, which would likely spur greater turmoil in the region.

Ambitious proposals to contain the crisis include new Socialist President of France, Francois Hollande, pushing for the introduction of common European debt. However, German Chancellor Angela Merkel believes they could lead to fiscal laxity among the weaker members of the euro zone.

As hopes for a breakthrough faded, the euro fell overnight to touch a low of $1.2545, its lowest level since July 2010, and was stable during Asian trading at $1.2582.

Some investors “were hoping for more positive announcement to come out from European leaders. There was a bit of a build-up, which is why we saw a sharp sale of assets overnight,” said Justin Harper, market strategist at IG Markets in Singapore.

Japanese companies with a strong exposure to the euro zone underperformed the Nikkei. Camera maker Canon was down 3.7% and Honda Motor fell 2%.

China shares turned lower as manufacturing data for May pointed toward a deteriorating economic environment in Asia's largest economy.

Oil climbed 0.6% on Thursday to $90.45 a barrel, picking up from the new 2012 settlement low of $89.90 that it reached late in New York

On the JSE, Anglo American (AGL) was up R1.52 to R267.65, BHP Billiton (BIL) gained R2.11 to R224.62 and Sasol (SOL) added R2.00 to R354.00.

AngloGold Ashanti (ANG) was up R12.28, or 4.22% to R303.338, Gold Fields (GFI) added R4.20, or 4.01%, to R108.93 and Harmony Gold Mining (HAR) gained R3.60, or 4.67%, to R80.70

Impala Platinum (IMP) gained R1.60 or 1.18% to R136.85.

Barloworld (BAWI) was up R1.83, or 2.23%, to R83.83.

In banking stocks African Bank (ABL) was up 50 cents to R36.16 and Firstrand (FSR) added 27 cents to R25.07.

In financial services Sanlam (SKM) gained 47 cents or 1.46 to R32.72. - I-Net Bridge

Asian shares eased as markets were vulnerable to faltering factory orders in China and lack of concrete measures shown by European leaders to tackle the risk of Greece leaving the currency bloc.

Asian shares eased on Thursday as markets were vulnerable to faltering factory orders in China and lack of concrete measures shown by European leaders to tackle the risk of Greece leaving the currency bloc.

European Union leaders, at an informal meeting on Wednesday, said they wanted Greece to stay in the euro zone while respecting commitments it had made in return for its bailout, but have been advised by senior officials to prepare contingency plans in case Greece exits.

The murky outlook for the euro zone and fears that the crisis could derail the global economy have prompted investors to park money in safe-haven assets such as US and German government bonds, the US dollar or cash.

Implications of a retreat in China's HSBC Flash Purchasing Managers Index, the earliest indicator of the country's industrial activity, gradually sank into market players' minds as the data reflected persistent weakness in the world's second-largest economy despite policymakers aiming to shore up growth.

The PMI fell to 48.7 in May from 49.3 in April as export orders fell to two month lows, marking the seventh straight month that the index has been below 50, signalling that the sluggish economic conditions are set to continue throughout the first half of the year.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.4 percent early, then slid to be down 0.4 percent before recovering to be off 0.1 percent. Shares in Australia, which are heavily reliant on demand for commodities from China, fell 0.2 percent. Japan's Nikkei stock average, which was down at one point, later was up 0.2 percent.

Despite the China news, European shares looked likely to take cue from a late recovery in Wall Street, with spreadbetters predicting major European markets would open as much as 1 percent higher. US stock futures were down 0.1 percent.

In Europe, that region's manufacturing PMI figures due later in the session will likely be the focus.

“This (China) data will take a backseat to any development from Europe,” said Miguel Audencial, trader at CMC Markets.

Weak data could accelerate selling in the single currency as it would highlight the damage to economic fundamentals from Europe's failure to fix its debt refinancing and banking instability.

The dollar index on Thursday eased from its highest since September 2010 of 82.221 reached the previous session.

Ashraf Laidi, chief global strategist at City Index, said the index could climb towards 90 later this year, citing potential catalysts such as mismanagement of a Greece exit from the euro zone, or if Athens and its global lenders remained deadlocked.

US 10-year yields fell to 1.73 percent on Wednesday, nearing 1.67 percent set in September, which was the lowest in at least 60 years.

Strong bids resulted in Germany selling its first-ever zero-coupon two-year bonds on Wednesday.

The euro was down 0.1 percent at $1.2575, just above its lowest level since July 2010 of $1.25453 hit the previous day.

The yen was stuck against the dollar at around 79.50 yen while not far from its highest in more than three months of 99.531 yen against the euro hit on Wednesday.

Yields around the world falling to low levels slows an outflow of capital from Japan even if the dollar or the euro cheapens against the yen, while the 'risk-off' mood prompts Japanese investors to hold the yen, said Tohru Sasaki, head of Japan rates and FX research at JPMorgan Chase Bank in Tokyo

“This dampens yen selling incentives. It's a flip side of a yen strengthening but these factors are not positive incentives to buy the yen. It reflects a decreasing number of people selling the yen,” Sasaki said.

EUROPE DIVIDED

Sasaki said the euro would remain depressed because even if uncertainty over Greece is cleared, that does not resolve the broader issue of the euro zone's debt crisis.

Analysts said that with European leaders at odds over specific proposals to prevent a contagion from political turmoil in Greece and to stabilise fragile banking systems, it was hard to build positions in risk assets.

“Therefore we prefer to stay in 'risk off' mode,” said Barclays Capital analysts in a research note.

Gold, which can also be perceived as a safe-haven in times of turmoil, has been moving more in sync with the weak euro. Spot gold was down 0.4 percent at $1,555.66 an ounce.

“When cash flows into precious metals seen as safe for their liquidity is when rounds of profit-taking selling are complete,” said Naohiro Niimura, a partner at Tokyo-based research and consulting firm Market Risk Advisory Co.

Europe also faces the need to stem the fallout from a winding up or restructuring of bad banks.

Spain announced a 9-billion-euro ($11.3 billion) bailout for troubled lender Bankia, its fourth-largest, on Wednesday, while also seeking ways to help its highly indebted regions meet huge refinancing needs.

US crude futures recovered 0.4 percent to $90.26 a barrel on Thursday, while Brent was up 0.3 percent at $105.88 a barrel.

Asian credit markets stabilised, with the spread on the iTraxx Asia ex-Japan investment-grade index widening by just one basis point. - Reuters

The euro remained under pressure against other currencies in Asia with European Union leaders' pledge of united fight against the debt crisis failing to impress market players.

The euro remained under pressure against other currencies in Asia on Thursday with European Union leaders' pledge of united fight against the debt crisis failing to impress market players.

The euro, which hit a 22-month low of $1.2545 Wednesday, bought $1.2579 in Tokyo morning trade against $1.2582 in New York late Wednesday.

Against the Japanese currency, the euro fetched 100.01 yen against 99.96 in New York where the European unit fell below the 100 yen mark for the first time since early February.

At one point in New York it hit 99.53 yen before recovering.

The euro remained under pressure as traders saw an apparent lack of consensus in Europe on how to deal with the region's debt crisis as a sign that market turmoil is set to continue, dealers said.

Japan's Finance Minister Jun Azumi said Thursday that the eurozone crisis was continuing to weigh on global markets.

“A sense of caution is hanging over the world,” Azumi told reporters at the finance ministry as EU leaders closed their talks.

At the end of an informal summit, European Union leaders reiterated that they supported Greece's continued euro membership as long as the country honours its commitments to fiscal consolidation and structural reforms.

But they sent mixed messages on concrete steps to deal with the widening crisis, such as a proposal to issue eurozone bonds to reduce borrowing costs for struggling countries.

French President Francois Hollande stepped up his crusade Thursday to convince eurozone nations to share debt between rich and poor despite resistance from Germany.

European leaders “are speaking about the same subject, but what they are saying is so different from each other,” said Yuji Saito, director of foreign exchange at Credit Agricole Bank in Tokyo. - Sapa-AFP

US stocks staged a late-day reversal, rallying into the close in another volatile session as a sharp rise in materials shares boosted the S&P 500 and gains in Apple helped lift the Nasdaq.

US stocks staged a late-day reversal on Wednesday, rallying into the close in another volatile session as a sharp rise in materials shares boosted the S&P 500 and gains in Apple helped lift the Nasdaq.

The action shortly before the market's close was a mirror image of Tuesday when stocks gave up gains in the last minutes of trading. The late rebound suggested investors saw value in the market after the S&P 500 fell just below 1,300 but also underscored the skittishness of the trading environment.

One trader warned not to read too much into the move that lifted the indexes near breakeven for the day.

“I don't make anything of this. Volumes are very low, so there's no conviction,” said Todd Schoenberger, managing principal at the BlackBay Group in New York. “We're only hearing what we want to hear. Don't be surprised if futures are disappointed tomorrow.”

Towards the close traders cited rumors that the European Union was considering a proposal to guarantee bank deposits across the bloc. Such a move could assuage fears of bank runs in Spain and Greece. The rumors, which one trader said may have originated in London, appeared to be unfounded and served to highlight the markets' current sensitivity to events in Europe.

Shares in beaten-down materials companies led the S&P 500, with the S&P's materials sector gaining 1.1 percent. Alpha Natural Resources rose 5 percent to $11.70. Boosting the

Nasdaq were shares of Apple, up 2.4 percent to $570.56.

In the overall market, the Dow Jones industrial average dipped 6.66 points, or 0.05 percent, to 12,496.15. The S&P 500 Index edged up 2.23 points, or 0.17 percent, to 1,318.86. The Nasdaq Composite gained 11.04 points, or 0.39 percent, to 2,850.12.

For most of the day shares fell by more than 1 percent as EU officials said euro zone countries must prepare contingency plans for a possible Greek exit of the currency bloc, while a weak outlook from Dell Inc cast doubts about the strength of global tech spending.

Volume on the NYSE, Nasdaq and Amex was above average.

Around 7.52 billion shares traded compared with a year-to-date average of 6.84 billion. About three stocks rose for every two that fell on the NYSE.

Shares in Dell Inc tumbled more than 18 percent and hit other tech stocks as the revenue forecast from the third-largest computer maker spurred fears that global tech spending was declining faster than thought.

Dell plunged 17.2 percent to $12.49, its biggest one-day drop in more than a decade.

Hewlett-Packard slid more than 3 percent during the regular session. But shares of the tech company jumped 10 percent in extended trading after it released financial results.

HP outlined a multi-year plan including job cuts of 27,000 employees, or about 8 percent of its workforce, to spur growth.

The agreement by euro-zone officials on contingency planning for a Greek exit of the euro zone, or “Grexit” as some investors are now calling it, came during a teleconference of the Eurogroup Working Group on Monday, sources told Reuters.

Eric Kuby, chief investment officer at North Star Investment Management in Chicago, said renewed concerns about Greece, troubling outlooks from Dell and others, worries about the economy, Facebook's disappointing IPO and JPMorgan's recent trading loss were adding up to significant headwinds.

“It has made people less likely to jump in there and buy stocks,” he said. “A lack of good news, some bad news and these worries that have been around for a long time make it hard to get a rally going.”

The S&P 500 is down 7 percent from a peak in April but is up 4.9 percent for the year so far. Some analysts are expecting the index to test its 200-day moving average at around 1,280, another 2 percent below current levels.

Facebook Inc and banks, including Morgan Stanley , were sued by the social networking leader's shareholders, who claimed the defendants hid Facebook's weakened growth forecasts ahead of its $16 billion initial public offering.

The stock was up 3.2 percent at $32 after falling more than 30 percent from it peak on Friday.

Falling oil prices also depressed the energy sector, with an S&P index of energy companies edging up 0.4 percent into the close.

US July crude oil future fell $2.30 to a session low of $89.55, trading below $90 a barrel for the first time since November 1, on easing concerns about Iran's nuclear dispute with the West and increasing worries about global economic growth. - Reuters

The South African rand hit a fresh 2012 low against the dollar on Wednesday.

Johannesburg - South Africa's rand hit a fresh 2012 low against the dollar on Wednesday, erasing two days of gains as risk aversion fuelled by mounting fears Greece will leave the euro zone hit emerging markets.

The falls tracked declines in the euro as officials asked members of the single currency zone to prepare contingency plans in case of a Greek exit, sources told Reuters.

Yields on South African government bonds rose to one-week highs, with investors concerned that the weaker rand would increase inflationary pressures.

Earlier, data showed April headline inflation quickened to 6.1 percent year-on-year from 6.0 percent in March.

The rand traded at 8.44/dollar at 16h00 GMT, coming off the day's low of 8.4626, a level last hit in November.

“We've seen a lot of flight to safety. A lot more people are moving their money out of emerging market currencies into the US dollar so we're seeing a very strong dollar this afternoon,” said Paul Chakaduka, a dealer at Global Trader.

The rand is sensitive to developments in Europe as the region is a major trading partner. The currency is also very liquid and investors use it to hedge broader emerging market positions, making it highly susceptible to changes in global risk sentiment.

The yield on the heavily traded three-year government bond rose nine basis points to 6.415 percent while that for the 14-year paper climbed 9.5 basis points to 8.36 percent. - Reuters

US stocks fell with all S&P 500 sectors trading negative, on mounting concerns over Greece's future in the euro zone and as a weaker-than-expected revenue forecast from computer maker Dell weighed on investor sentiment.

US stocks fell on Wednesday with all S&P 500 sectors trading negative, on mounting concerns over Greece's future in the euro zone and as a weaker-than-expected revenue forecast from computer maker Dell weighed on investor sentiment.

Euro zone officials have agreed that each euro zone country must prepare an individual contingency plan in the eventuality that Greece decides to leave the single currency area. The agreement was reached during a teleconference of the Eurogroup Working Group, which lasted for about an hour on Monday.

“Because the markets serve as a forward-looking mechanism, incorporating the impact of Greece's exit from the EU is now underway to a degree, with investors already handicapping the exit of additional EU members, Spain and others, where the exit could provide possibly more significant market volatility,” said James E. Russell, head of equity strategy at US Bank's wealth management division.

Earlier, stocks briefly trimmed losses after data showed new US single-family home sales rose more than expected in April and prices pushed higher, further evidence the housing market was turning the corner.

Dell Inc shares fell 15.6 percent to $12.74, a day after the company forecast disappointing second-quarter revenue as US and European corporate tech spending weakens and consumer personal computer sales continue to shrink.

Facebook Inc and banks including Morgan Stanley were sued by the social networking leader's shareholders, who claimed the defendants hid Facebook's weakened growth forecasts ahead of its $16 billion initial public offering. The stock was up 3.5 percent at $32.10.

The Dow Jones industrial average was down 141.22 points, or 1.13 percent, at 12,361.59. The Standard & Poor's 500 Index was down 13.57 points, or 1.03 percent, at 1,303.06. The Nasdaq Composite Index was down 25.16 points, or 0.89 percent, at 2,813.92. - Reuters

The rand fell 1.5 percent to hit a fresh 2012 low against the dollar in the afternoon session as the euro currency plunged below $1.26.

The rand fell 1.5 percent to hit a fresh 2012 low against the dollar in the afternoon session on Wednesday as the euro currency plunged below $1.26.

The local unit often tracks moves on the euro as the region is a major trading partner for South Africa. The rand was down 1.38 percent at 8.4550 at 16:41 SA time, coming off slightly from the session low of 8.4626. - Reuters

South African stocks slid to a 4-1/2 month low as skittish investors sold off index heavyweights as part of a global equity sell-off on nagging concerns about the European debt crisis.

South African stocks slid to a 4-1/2 month low on Tuesday as skittish investors sold off index heavyweights as part of a global equity sell-off on nagging concerns about the European debt crisis.

The benchmark Top-40 index was down 1.8 percent at 29,017.41, near its lowest since early January.

Shares of platinum miners such as Lonmin were the worst hit, as spot prices of the precious metal slid. - Reuters