Comments
Japanese stocks finished at a near two-week high on Tuesday, as a weaker yen boosted many export-oriented stocks, while tech shares were cheered by the strong Nasdaq performance overnight.
The Nikkei rose 0.6 per cent to 20,195.48, the highest closing level since June 29. The broader Topix climbed 0.7 per cent to 1,627.14, but volumes hit a two-week low of 1.43 billion shares.
Panasonic Corp soared 2.0 per cent and Hitachi Ltd gained 1.6 per cent after the Nasdaq Composite and the S&P 500 technology index rose overnight on expectations for brisk earnings. Technology companies are expected to post some of the strongest earnings growth figures for the second quarter, according to Thomson Reuters data.
Overall sentiment was positive, as the dollar rose to 114.45 yen to hit a four-month high. The dollar has been strong against the yen since the Bank of Japan had offered last week to buy an unlimited amount of bonds, which drew investors' focus to the divergent monetary policy outlook between the BOJ and the US Federal Reserve.
The spread between 10-year Treasury and JGB yields is the widest it has been in two months, contributing to the dollar's strength against the yen.
Market analysts said that investors are likely to continue to take heart from the weak yen for now, while strength in tech shares is expected to support the Nikkei benchmark index.
“While Japanese exporters expect much lower dollar-yen assumptions, the current currency levels raise hopes for better Japan Inc earnings,” said Nobuhiko Kuramochi, a strategist at Mizuho Securities.
He also said that there is demand for growth shares and commodity-related stocks globally, and the Japanese market is following this trend, citing strong performance among resource giants like Rio Tinto, BHP Billiton and Freeport-McMoRan.
“Strength in these stocks indicate a pick up in global demand, which helps appetite for Japanese stocks as well," Kuramochi said.
Meanwhile, ink jet printer and watch maker Seiko Epson Corp soared 3.7 per cent after Nikkei Inc said it would add the company's stock to the benchmark Nikkei 225 average, replacing scandal-hit Toshiba Corp , which fell 1.8 per cent.
Elsewhere, Suzuki Motor Corp fell 1.8 per cent after Dutch prosecutors said they would investigate the automaker's possible misuse of vehicle emissions software.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.