HONG KONG - Asian stocks edged up while the yen rose to a 15-year high on Tuesday ahead of a decisive vote in Japan, leaving unclear whether a rally that lifted global equities to the highest in four months can stay alive. The yen has for the past few years been a gauge of investors' distaste for risk-taking, rising when the need for stability is high. Investors though have had mixed signals in September about whether it is the right time to shift out of havens and buy back riskier, higher-yielding assets. Resilient economic growth out of China and relief that new banking regulations will not unleash a rush to raise equity have gently turned the attention of investors away from uncertainty about the US recovery. August US retail sales due later could be a reminder though of how much the economy is slowing. "Although better data in the US and China and the agreement in Basel on new regulations have boosted risk appetite, the moves are already beginning to look exhausted," Mitul Kotecha, global head of foreign exchange strategy at Credit Agricole CIB, said in a note. "It would be easy to jump on the bandwagon, but after the sharp gains registered over recent days we would suggest taking a cautious stance about jumping into risk trades at current levels." Japan's ruling party was holding a leadership election on Tuesday that will determine who is Japan's prime minister and could have a big impact on how Tokyo deals with persistent yen strength and deflation. The US dollar was down 0.4 per cent to 83.34 yen after earlier falling as low as 83.23 yen in busy trade.
