Nikkei rises

The Nikkei average rose on Friday to round off a week of gains as foreign investors scooped up battered shares, but their buying could ebb next week on persisting concerns about a crippled nuclear plant and power cuts. Foreign investors' net buying of Japanese shares reached a record high last week, the week after a devastating earthquake hit north-eastern Japan, Ministry of Finance data showed, and traders say their buying continued this week.
Overseas investors bought a net 891 billion yen ($11 billion) in Japanese stocks in the week of March 14-18, the highest since records began in 2005. Some analysts said foreign buying may continue before the ex-dividend date on March 28 but others were worried that their buying - the main driver of the market rebound since last week - may peter out soon.
"Many companies downgraded their earnings estimates this week and some halted dividends for this year," said Hiroyuki Fukunaga, chief executive of trading information provider Investrust. The benchmark Nikkei ended the day up 1.1 percent or 101.12 points at 9,536.13, helped by broad optimism towards the global economy and a rise in US shares ahead of forthcoming earnings reports.
On the week, the Nikkei gained 3.6 percent, consolidating around 9,500 in a narrow 200-point range as investors cautiously watched developments at the quake-crippled Fukushima nuclear plant. The broader Topix index gained 0.4 percent to 857.38 on the day, for a weekly gain of 4.4 percent. On Friday, advancing shares outpaced declining ones by 922 to 638. Analysts also said the overall market got a lift as investors bought on dips, with some technical indicators showing that Japanese stocks are heavily oversold.
The Nikkei is now trading about 6 percent below its 25-day moving average at 10,116. At the end of the week, the Nikkei's price-to-book ratio stood at 1.1, roughly half that of the US S&P 500 and Hong Kong's Hang Seng benchmark. About 3.15 billion shares changed hands on the first section of the Tokyo Stock Exchange on Friday, still above the average of the past three months. Still, trading volume appears to be declining after peaking on Tuesday last week, when the Nikkei plunged about 10 percent.
Investrust's Fukunaga said the Nikkei will likely move between 9,000 and 9,600 over the next five sessions. Construction equipment makers rose on expectations of reconstruction-related demand as well as higher resource prices. Komatsu Ltd gained 4.7 percent to 2,795 yen.
Shares in food processor Nichirei jumped 5.7 percent to 355 yen after the Nikkei business daily reported it would join forces with the Itochu group in the frozen-food business, taking on most of the lost production at a tsunami-damaged factory operated by an Itochu subsidiary in northern Japan. Sony Corp gained 3.3 percent to 2,634 yen after Deutsche Securities raised its rating on the stock to "buy" from "hold" on expectations of rising sales in its chip and gaming businesses.