Tokyo stocks close 0.69pc higher

Tuesday, 08 May 2012 12:12

Posted by Muhammad Iqbal

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TOKYO: Tokyo stocks closed 0.69 percent higher on Tuesday, staging a small rally after the previous day's heavy losses as dealers digested the results of European elections.

The Nikkei 225 index at the Tokyo Stock Exchange which lost 2.78 percent on Monday to hit its lowest close in three months rose 62.51 points to close at 9,181.65.

The broader Topix index of all first-section shares closed up 0.58 percent, or 4.51 points, at 776.57.

The defeat of ruling parties in French and Greek elections at the weekend spawned worries over the fate of austerity measures aimed at tackling the eurozone's debt crisis, brokers said.

Investors were now taking a wait-and-see stance on the eurozone's fiscal woes, Tachibana Securities operating officer Kenichi Hirano told Dow Jones Newswires.

But "the Greece (debt) problem still needs to be treated with caution" since the fate of the country's economy remains uncertain, said Securities Japan chief market analyst Masayuki Otani.

On Tuesday, Japan's Finance Minister Jun Azumi warned France's new leader Francois Hollande to keep the nation's fiscal discipline in place amid worries he will overspend to boost the economy.

US stocks closed mixed Monday, largely shrugging off the European polls, with the Dow Jones Industrial Average slipping 0.23 percent, the S&P 500 up 0.04 percent and the Nasdaq 0.05 percent higher.

The euro moved narrowly against the dollar and yen in Asian trade Tuesday after rebounding in New York from heavy selling in early Monday in Tokyo.

The single currency bought $1.3029 and 104.23 yen, compared with $1.3052 and and 104.28 yen in New York late Monday. The dollar edged up to 79.98 yen from 79.88 yen.

Fuji Heavy climbed 7.30 percent to 602 yen after boosting its sales forecast for the current fiscal by 22.4 percent year on year, while trading giant Mitsubishi Corp gained 3.65 percent to 1,703 yen after saying it would see higher sales and profits this year.

Trading house Marubeni rose 3.77 percent to 550 yen after the Nikkei business daily reported that it was in the final stages of negotiations to buy US grain company Gavilon LLC for about $3.8 billion.