Tokyo stocks open higher after recent falls

TOKYO: Tokyo shares opened higher Tuesday on bargain hunting, shrugging off news of a shrinking economy in Japan and ongoing worries over coronavirus infections.

The benchmark Nikkei 225 index added 0.82 percent, or 228.40 points, to 28,053.23 while the broader Topix index added 0.63 percent, or 11.82 points, to 1,890.68.

Investors looked for bargains after recent falls, including a 0.92 percent loss in the Nikkei index on Monday, while the yen slowed its appreciation against the dollar, giving some support to the market.

Overnight falls on Wall Street were moderate, with the Dow ending 0.2 percent lower, while the tech-rich Nasdaq fell 0.4 percent.

"Last week, we saw sharp falls (of Tokyo shares). And now we are seeing a natural reaction to that," said Makoto Sengoku, senior equity market analyst at Tokai Tokyo Research Institute.

"Japanese shares fell rather sharply yesterday too. Then US shares were seen as relatively calm. So that was seen as positive for the market," he added.

Okasan Online Securities said: "The market is seeing active bargain hunting. Gains of Toyota shares are also brightening market sentiment."

Toyota jumped 1.99 percent to 8,820 yen, while rival Nissan also surged 1.39 percent to 545.3 yen. Honda soared 2.75 percent to 3,327 yen.

Shortly before the Tokyo market opened, the Cabinet Office said Japan's economy contracted 1.3 percent in the three months to March, broadly in line with market expectations.

"As for the GDP, I think people knew what was coming," Sengoku said. "It was to be expected under the coronavirus pandemic. I believe the market has it broadly factored in."

Among blue-chip stocks, Uniqlo operator Fast Retailing added 2.82 percent to 88,520 yen. SoftBank Group rose 1.71 percent to 8,575 yen. Robot maker Fanuc surged 2.60 percent to 25,215 yen.

Mitsubishi UFJ Financial Group jumped 1.93 percent to 624.3 yen.

But Nintendo gave up gains and dipped 0.24 percent to 62,560 yen.