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Tokyo’s Nikkei closes up more than 3.8% following NY rally
TOKYO, Dec 27, 2018 (BSS/AFP) – Tokyo’s benchmark Nikkei index closed more
than 3.8 percent higher on Thursday, with investors heartened by Wall
Street’s best performance in nine years.
The Nikkei 225 index soared 3.88 percent or 750.56 points to close at
20,077.62, while the broader Topix index was up 4.90 percent or 70.16 points
at 1,501.63.
The rallies came after the Nikkei index lost more than four percent this
week amid rising doubts about the US economy and fears sparked by a US
government funding crisis.
“Bargain-hunting was triggered by US rallies as investors bought on dips
following the recent slump,” said Daiwa Securities senior technical analyst
Hikaru Sato.
“But today’s rally does not mean that all the negative factors, including
the US-China trade war and Brexit, have disappeared,” Sato told AFP.
“Sensitive and volatile trading is expected to continue for now,” he added.
Exporter shares rose strongly as a weaker yen improved their business
outlook.
The dollar was trading at 111.13 yen in Asian afternoon trade, down from
111.33 yen in New York but up from 110.45 yen when Tokyo closed on Wednesday.
Wall Street stocks roared back to life in post-Christmas trade on
Wednesday, shaking off four straight routs following strong retail sales data
and White House reassurances that Fed Chair Jerome Powell won’t be fired.
The Dow Jones Industrial Average finished up nearly 1,100 points, or about
five percent, with the broad-based S&P 500 also surging five percent.
The US gains were the biggest for a single session on Wall Street in nine
years, a surge analysts attributed in part to technical factors after days of
selling.
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“It was possible that risk appetite wouldn’t recover until after the new
year but thanks to the upturns in Tokyo and New York, we are likely to see
the new year in with a somewhat brighter mood,” Mizuho Securities said in a
note.
Many investors have been unnerved by a variety of factors, including the
partial US government shutdown, the US-China trade war and US President
Donald Trump’s ongoing criticism of Fed Chair Powell.
But a sense of relief won out for now.
Sentiment also improved after a Bloomberg News report said a US government
delegation will travel to Beijing in early January to hold trade talks in the
first face-to-face discussion since Trump and Chinese leader Xi Jinping
agreed on a 90-day truce.
Sony climbed 5.50 percent to 5,384 yen and Toyota added 4.37 percent to
6,415 yen with Nissan up 3.25 percent at 884.8 yen.
Energy shares were also higher on rises in oil prices, with petroleum
explorer Inpex up 4.27 percent at 980.4 yen with Idemitsu Kosan up 10.07
percent at 3,660 yen.
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