Nikkei climbs on record-breaking U.S. rally and weaker yen
Tokyo stocks went up Friday on buying spurred by a record-breaking advance on Wall Street and the yen’s softening against the dollar.
The Nikkei average of 225 selected issues on the first section of the Tokyo Stock Exchange jumped 108.13 points, or 0.45 percent, to end at 24,041.26. It rose 16.55 points Thursday.
The Topix index of all TSE first-section issues closed up 6.72 points, or 0.39 percent, at 1,735.44, after losing 2.34 points the previous day.
Stocks rocketed right after the opening bell, with the Nikkei average shooting up by over 180 points to hit a 15-month high on an intraday basis.
Investors took heart from all three major U.S. market gauges rewriting their closing highs on Thursday and the dollar scaling to around ¥110.20, brokers said.
On Wall Street, sentiment was brightened by vigorous corporate earnings and stronger-than-expected U.S. economic indicators, including the Federal Reserve Bank of Philadelphia’s manufacturing index for January, they noted.
The Tokyo market saw profit-taking pressure build up after the initial spurt. But partly underpinned by buying on the yen’s drop, the market resisted going south until the closing.
“With no fresh developments seen on the U.S.-China trade front, the Tokyo market reacted straightforwardly to the positive business and economic news,” said Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc.
Hirohumi Yamamoto, a strategist at Toyo Securities Co., observed that financial stocks attracted hefty buying in the wake of U.S. financial giant Morgan Stanley’s October-December 2019 profit beating the market’s consensus Thursday.
Meanwhile, Fujii pointed out that the market failed to go higher after the early morning surge as investors were reluctant to increase their long positions before the weekend.
On the TSE’s first section, rising issues outnumbered falling ones 1,194 to 837, while 129 issues were unchanged. Volume increased to 1.079 billion shares from Thursday’s 1.033 billion shares.
Mega-bank Mitsubishi UFJ and brokerage firm Nomura Holdings advanced 1.23 percent and 1.05 percent, respectively.
Some stocks in the semiconductor sector were buoyant, with Shin-Etsu Chemical rising 1.33 percent and Sumco 0.58 percent.
Export-oriented issues, such as heavy machinery maker Komatsu and automaker Subaru, attracted buying thanks to the weak yen.
Glass maker AGC and Sumitomo Electric also rose.
On the other hand, Adastria fell 2.69 percent after Mizuho Securities Co. lowered its target stock price for the apparel store operator.
Among other losers were drug manufacturer Otsuka Holdings and department store operator Marui Group.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average rose 90 points to 24,030.