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Japan’s Nikkei share average rose to a fresh two-month high on Monday after China’s rate cut lifted risk appetites, while bellwethers Hitachi Ltd and Panasonic Corp surged on stronger profit expectations.
The Nikkei ended 0.7 per cent higher to 18,947.12, the highest closing level since August 28.
The broader Topix also gained 0.7 per cent to 1,558.99, and so did the JPX-Nikkei Index 400, which ended at 13,979.88.
China has unexpectedly cut its benchmark one-year lending rate by 25 basis points to 4.35 per cent and lowered the reserve requirement ratio for all banks in a bid to lift a sagging economy.
Risk sentiment has already been boosted by Thursday’s message from European Central Bank President Mario Draghi that the bank was ready to adjust “the size, composition and duration’’ of its quantitative easing programme.
“The ECB and China paved the way for additional easing by the Bank Of Japan,’’ said Hiroaki Mino, director of investment information department at Mizuho Securities.
But he added that even if the BOJ stands pat on Friday, investors may not be severely disappointed because expectations of a cut will likely stay in the market for the rest of the year.
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