TOKYO: Tokyo stocks closed higher on Friday, following rises on Wall Street, as data showed the world’s third-biggest economy was growing faster than analysts had expected.
The benchmark Nikkei 225 index rose 0.44 percent, or 91.47 points, to 20,684.82, narrowing the weekly loss to 1.91 percent.
The broader Topix index ended up 0.35 percent, or 5.18 points, at 1,503.84. Over the week, it lost 1.93 percent.
“US stocks rose sharply, providing relief and support to the Tokyo market,” said Makoto Sengoku, market analyst at Tokai Tokyo Research Institute.
The stronger-than-expected GDP data also helped boost the market, he said.
“The reading of the data itself was not a huge buying peg… but nonetheless it confirmed personal spending could pick up,” he said.
Official data showed gross domestic product (GDP) in the world’s third-biggest economy grew 0.4 percent from the previous quarter on robust consumer demand, beating analysts’ median forecast of 0.1 percent.
Japan had an unprecedented string of 10 holidays around the May 1 enthronement of the new emperor, igniting travel and other leisure demand.
Mutsumi Kagawa, chief global strategist at Rakuten Securities, also said “excessive worries have receded after the Wall Street rally.”
Investors were also “relieved to see the yuan rate stable”, he said.
Beijing stoked fears that it was trying to devalue its currency in retaliation for new US tariffs on Chinese goods after it slid sharply on Monday but the yuan was unlikely to plunge to extraordinary levels, Kagawa said.
“There is no point for China to drive down its currency too much as it would trigger a capital flight,” Kagawa argued.
The Japanese currency remained strong, capping buying in stocks.
The dollar changed hands at 105.88 yen against 106.06 yen in New York Thursday afternoon.
IT investor SoftBank Group was down 0.65 percent to 5,014 yen while Toyota finished up 0.39 percent at 6,837 yen.