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FOREX-Yen keeps soft tone after Goldman, Intel results

Published 07/14/2009, 09:20 PM
Updated 07/14/2009, 09:40 PM
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* Yen maintains soft tone against dollar, euro

* But investors still cautious

* BOJ may extend corporate finance support measures

TOKYO, July 15 (Reuters) - The yen maintained a soft tone on Wednesday, after falling the previous day when upbeat results from Goldman Sachs and Intel boosted investor risk appetite for stocks and modest hopes for an economic recovery.

But some analysts said that the reaction from the currency and stock markets could have been stronger, underlining caution ahead of more earnings results and data.

Goldman Sachs Group Inc said quarterly earnings surged 33 percent on blowout trading results, trouncing forecasts and putting the bank on pace for hefty bonuses. [ID:nN14175292}

Chipmaker Intel also reported results after the bell that surpassed expectations sending stock index futures sharply higher.

"The market could have reacted more to positive news from U.S. corporations and fundamentals the previous day," said Ayako Sera, market strategist at Sumitomo Trust & Banking.

"This means, market players are still cautious as they want to check out other U.S. earnings this week," she said.

Among U.S. corporations slated to announce quarterly earnings this week are JPMorgan Chase & Co, Bank of America Corp and Citigroup Inc.

U.S. June retail sales on Tuesday were also better-than-expected but much of the 0.6 percent rise in the data was driven by higher gasoline prices.

The dollar edged up 0.1 percent to 93.58 yen, after advancing nearly 1 percent on Tuesday. It had hit a five-month low of 91.73 yen on Monday.

But gains in the U.S. currency will likely be capped when it rises towards 94 yen, dealers said.

The euro was 0.1 percent higher at 130.76 yen, and it was steady at $1.3972.

Tokyo's Nikkei share average rose 0.5 percent.

The Bank of Japan will end a 2-day policy review later in the day and may extend measures to support corporate financing to avoid undermining a fragile recovery in the economy and investor confidence.

The bank is almost certain to keep its interest rate target at 0.1 percent. (Reporting by Kaori Kaneko; Editing by Edwina Gibbs)

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