ETF Trends
ETF Trends

Japanese stocks and exchange traded funds declined Wednesday and the yen advanced after Japan announced a $100 billion plan to help companies survive as the currency spikes.

The government will release foreign-exchange reserves to the Japan Bank for International Cooperation for funding to help exporters and drive purchases overseas, Bloomberg reported.

Separately, Moody’s on Wednesday downgraded the rating on Japan’s government debt by one notch to Aa3, blaming large budget deficits and the build-up of debt since the 2009 global recession, Reuters reported.

The iShares MSCI Japan (NYSEArca: EWJ) was down nearly 2% in premarket trading.

The rise of the Japanese yen has pressured the country’s exporters. CurrencyShares Japanese Yen Trust (NYSEArca: FXY) is up nearly 7% over the past three months. [Japan ETFs Claw Back Toward Pre-Quake High as Yen Rises]

In economic data, the Japanese economy contracted less than anticipated in the second quarter. The country saw a 1.3% contraction in the second quarter, reports The Vancouver Sun.

“We can expect to realize relatively high growth in the latter half of this year,” said Kaoru Yosano, state minister for economic and fiscal policy. “We want to pay particular attention to the possible impact on our economy of a growing sense of uncertainty in the world economy, and the rising strength of the yen.” [Japanese Yen ETF Back Near Record High]

iShares MSCI Japan

Tisha Guerrero contributed to this article.

Read the disclaimer; Tom Lydon is a board member of Rydex|SGI.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.