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JOHANNESBURG – World shares limped towards their biggest weekly fall of the year on Friday, though investors took heart from a dip in government bond yields as the incoming Bank of Japan chief ruled out an early end to its super-easy monetary policy.

There was focus too on the first anniversary of Russia’s invasion of Ukraine, or ‘special military operation’ as Russia terms it, as calls for peace, but also warnings about a wider escalation, came from both Washington and Beijing.

Overnight

European share markets opened higher, with the pan region Euro Stoxx 600 up 0.4 per cent though overnight falls in Asia and lower Wall Street futures prices Wall Street meant MSCI’s main worldwide index was stuck in the red.

Europe’s moves were partly helped by a pause in this month’s sharp rise in global borrowing costs — a reversal of January’s trend.

During a lower house confirmation hearing, Kazuo Ueda, who will take over as governor of the Bank of Japan (BOJ) in April, said ultra-low interest rates were still needed to support Japan’s fragile economy, warning of the dangers of responding to cost-driven inflation with monetary tightening.

“Ueda is working hard to present himself as delivering continuity,” said Sean Callow, Senior Currency Strategist at Westpac. “At least to start with.”

Japan’s Nikkei share index closed up 1.1 per cent, while its five-year government bond yield eased to 0.235 per cent.

Ten-year Japanese bonds didn’t trade on Friday due to thin liquidly, after breaching the upper limit of the BOJ’s policy cap for two straight days. But the yen turned choppy as data also showed core consumer inflation hitting a 41-year high, keeping pressure on the BOJ to phase out its stimulus programme.