OVERNIGHT

The yen and the export disaster. Sounds like a good title for a fairy tale. But it's no fairy tale as the yen moved to  beak a multiple year and a half high against the dollar, putting the skids to Japan's exporters.

It wasn't supposed to happen, not in the negative interest rate environment Japanese officials pushed through in late January. It was really another indirect play on beggar thy neighbor in what most in the MSM fail to admit, a currency tussle. It was suppose to work. So far it hasn't. So far it's main effect has been to further depress investor confidence in central bankers in general and Abernonics in particular.

So if your name is Honda, Sony or Toyota you might start feeling pain soon. The effect on the Nikkei 225 has been pretty obvious, down more than eight percent in the past week.

Asian shares extended losses to three-week lows on Friday, while the yen soared to a 17-month high against the dollar as investors bet Japan would be hard pressed to drive down its currency in the face of widespread foreign opposition. MSCI's broadest index of Asia-Pacifc shares outside Japan dropped 0.5% off nearly 1% for the week, Reuters reported.

Nikkei .N225 pared earlier losses to near-two-month lows to trade 0.6 percent lower, with financials under pressure. It's on track for a decline of 3.1 percent for the week.

China's Shanghai Composite index .SSEC slid 0.9 percent, poised for a similar drop for the week. The CSI 300 .CSI300 was down 0.8 percent, set for a 1.2 percent weekly decline. Hong Kong's Hang Seng .HSI slipped 0.7 percent, headed for 1.9 percent loss for the week. 
Bank shares led losses in Europe and the U.S. markets on Thursday, amid talk of more layoffs and cutbacks planned by Europe's major lenders as they struggle with zero rates.

The U.S. S&P 500 Index .SPX lost 1.2 percent, with financial shares .SPSY falling 1.9 percent. In Europe, the FTSEurofirst 300 closed down 0.8 percent, hurt by a drop of more than 2 percent in financials.
 
The yen strengthened to 107.67 to the dollar on Thursday, its highest since October 2014, and last stood at 108.64, heading for a weekly gain of 2.6 percent.
The dollar index .DXY, which tracks the greenback against a basket of six rival currencies, was up about 0.1 percent at 94.583, poised for a flat weekly performance.
The euro EUR= also hit a six-month high of $1.1454 the previous day and last fetched $1.1361, set to end the week up 0.2 percent.

On the other hand, commodity-linked currencies and many emerging economy currencies stepped back from recent multi-month highs as risk-averse mood took hold on investors.
 
The Australian dollar traded at $0.7533 AUD=D4, having fallen 1.3 percent on Thursday.
In the commodities market, copper suffered its biggest fall in more than six months on Thursday, slumping 2.8 percent on the day and hitting a six-week low of $4,631 a tonne.