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Japanese shares prices rebounded from one-month low on Friday, taking heart from rises in global shares on the Fed’s cautious rates and economic outlook, but they posted the third straight weekly decline.
The Nikkei rose 0.9 per cent to 20,174.24, bouncing off one-month low of 19,990.55 set on Thursday. Turnover was ¥2.96 trillion, more than 10 per cent above the average during the 100 past days.
The market showed limited reaction after the Bank of Japan maintained its policy unchanged as expected. The short-selling ratio hit a record high of 38.3 per cent on Thursday, suggesting speculators are likely to have a big short position to cover, giving support for the market.
On the week, the Nikkei was down 1.1 per cent on the week. The broader Topix index rose 0.9 per cent to 1,631.01 but was down 1.2 per cent on the week.
FII holding
Market sentiment was also supported by data showing strong foreigners’ appetite in the Japanese market. According to the Tokyo Stock Exchange, foreigners held a record 31.7 per cent of Japanese stocks as of March, the end of the last fiscal year.
“Foreign investors were attracted to Japanese stocks mainly because of their recovering fundamentals,’’ said Shingo Kumazawa, an analyst at Daiwa Securities, adding that more foreign buying is expected in the coming months on the back of stronger shareholder returns and Japan's first corporate governance code which came into effect this month.
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