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Japan's Nikkei share average rose on Monday morning, led by sharp gains for Toyota Motor Corp after it upgraded its earnings outlook, while a weaker yen following strong US jobs data underpinned overall sentiment.
Toyota rallied 2.3 per cent to 6,360 yen, the highest level since mid-March, after the world's No.2 automaker raised its full-year outlook on Friday thanks to favourable exchange rates.
The Nikkei rose 0.6 per cent to 20,080.50 in midmorning trade. The broader Topix gained 0.6 per cent to 1,641.21, after reaching 1,642.34, the highest level since August 2015. “Carmakers had conservative earnings outlooks in the beginning of this fiscal year, so the fact that Toyota raised its forecast is boosting sentiment,” said Hikaru Sato, a senior technical analyst at Daiwa Securities. “The market has been happy with quarterly Japanese corporate earnings so far, and such positive sentiment will likely last this week.”
The dollar, which briefly sank below 110.00 yen to a seven-week low last week, finally pulled ahead after stronger-than-expected jobs growth in July.
On Friday, the keenly followed US jobs data showed US non-farm payrolls rose by a better-than-expected 209,000 jobs last month, and June's employment gain was revised higher.
In Asian trade, the dollar was up 0.1 per cent at 110.785 yen after rising as high as 111.050 on Friday. Japanese financial stocks, which invest in higher yielding products, staged a rally after the solid US jobs data pushed up US Treasury yields. Insurers Dai-ichi Life Holdings rose 1.4 per cent, T&D Holdings gained 2.1 per cent, while banks Mizuho Financial Group surged 1.0 per cent and Sumitomo Mitsui Financial Group climbed 0.8 per cent.
Another big mover was Toshiba Corp, which soared more than 9 per cent to hit a 1-1/2-week high after the Nikkan Kogyo Shimbun newspaper reported on Monday that the company's auditor will sign off on its financial results for the year ended March.
Toshiba's auditor, Pricewaterhouse Coopers Aarata, will issue a so-called “unqualified opinion” or a “qualified opinion" by a bourse-imposed deadline on Thursday, the daily said, without citing sources.
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