Tokyo shares rebound on bargain hunting despite US, virus concerns

TOKYO: Tokyo's benchmark Nikkei index rebounded to end higher Wednesday on bargain hunting even as investors fretted over a new coronavirus strain and the uncertainty over a new US stimulus.

The Nikkei 225 ended a losing streak and rose 0.33 percent, or 88.40 points, to 26,524.79.

The broader Topix index added 0.23 percent, or 4.09 points, to close at 1,765.21.

The Tokyo market started the day on a solid footing, lifted by the overnight rise of the Nasdaq, which finished at another record close.

Investors returned to buying after Tokyo fell for three consecutive sessions, SBI Securities said in a note.

But profit-taking and falls on US stock futures during the day weighed on the Tokyo market, SBI added.

The Nikkei dipped into negative territory mid-morning, after US President Donald Trump rejected a fresh bipartisan stimulus bill worth $900 billion, calling it "disgrace" and pushing lawmakers to increase the scope of the relief package.

But the index soon crawled back into positive territory, reflecting healthy investor appetite.

"Bargain hunting helped the Nikkei to stay well-supported," Okasan Online Securities said in a note.

But not many investors were willing to make aggressive purchases beyond the current range, leaving the Nikkei trapped in a narrow band, it added.

The dollar stood at 103.45, turning softer from 103.60 yen in New York Tuesday.

Technical charts also illuminated downside risks for the Tokyo market, as worries over the new variant of the virus were also weighing on the market, analysts said.

Many global investors are also leaving the market for holidays, locking the Tokyo market in the current range.

Many major shares zigzagged between positive and negative territory throughout the day, although some high-tech shares benefited from the strength of the Nasdaq.

Advantest, a major producer of chip-testing tools, surged 2.49 percent to 7,400 yen. Tokyo Electron, a producer of equipment to make semiconductors, rose 1.41 percent to 36,560.

Some major blue chip shares suffered.

Uniqlo-operator Fast Retailing fell 0.12 percent to 84,320 yen. Toyota lost 0.73 percent to 7,720, as did SoftBank Group, which gave up 2.56 percent to 8,075 yen.

Airlines managed to pull themselves above the clouds, with Japan Airlines rising 0.43 percent to 1,874 yen, while ANA Holdings added 0.21 percent to 2,155.5 yen.