Asian shares fall as oil lingers above $120, yen sinks

TOKYO (AP) — Shares were mostly lower in Asia on Thursday as investors watched for fresh signs of inflation and crude oil prices hovered above $122 a barrel, adding to price pressures.

Benchmarks declined across the region, except in Tokyo, where a weakening yen sent issues of some Japanese exporters higher. Nintendo Co. issues surged 1.9% in afternoon trading, while Honda Motor Co. stocks gained more than 0.9%.

The Japanese yen has recently slid to fresh 20-year lows against the U.S. dollar, a trend the International Monetary Fund and other analysts expect to continue for a while because of higher interest rates in the U.S. and Europe, compared to Japan, where long-term interest rates remain at near-zero.

The dollar was trading at 133.80 Japanese yen after hitting 134 yen levels earlier in the day, down from 134.20 yen late Wednesday. The euro cost $1.0721, inching up from $1.0718.

The Governing Council of the European Central Bank is holding a monetary policy meeting later in the day. Comments from Christine Lagarde, head of the European Central Bank, have markets anticipating an interest rate hike in July, with possibly more to follow.

“Nonetheless, the economic recovery remains fragile and subject to down side risks from geo-political risks, eroding real incomes, supply chain constraints and limited fiscal support,” said Venkateswaran Lavanya of the Asia & Oceania Treasury Department at Mizuho Bank in Singapore.

“To that end, ECB will not want to throw the baby out with the bath water; calibrating monetary tightening in a more sustained, even if slow, pace,” she said in a commentary.

Japan's benchmark Nikkei 225 gained 0.2% in afternoon trading to 28,290.06. Australia's S&P/ASX 200 slipped 1.2% to 7,037.10. South Korea's Kospi fell 0.4% to 2,616.46. Hong...