Japanese stocks end up 1.05pc

TOKYO: Tokyo shares rose 1.05 percent on Wednesday, after US and European markets closed higher following days of mark
10 Aug, 2011

The benchmark Nikkei-225 index of the Tokyo Stock Exchange was up 94.26 points to 9,038.74. The Topix index of all first-section issues added 0.82 percent or 6.34 points to 776.73.

The rise came after the Nikkei on Tuesday posted its lowest close since March 15, days after a massive quake and tsunami tore into northeast Japan.

US and European stocks rebounded later on Tuesday from Monday's huge losses in the wake of the US credit downgrade by Standard & Poor's.

Wall Street bulls drove the Dow Jones Industrial Average up 3.98 percent, battling back from a bout of weakness after the Federal Reserve offered a downbeat outlook on the US economy.

Buying resumed after the US central bank's policy-setting Federal Open Market Committee said that it expected to maintain interest rates near zero for "at least" the next two years due to economic weakness.

In Tokyo, buying was sporadic, with analysts remaining sceptical about the US economic outlook.

Economic concerns in the United States and Europe have not changed fundamentally, said Toshiyuki Kanayama, market analyst at Monex.

"The market is still nervous as it cannot read where stocks are going to settle," Takuya Yamada, senior portfolio manager at ITC Investment Partners, told Dow Jones.

"The heavy selloff we saw over the past three days was driven by emotional, not rational trading. The outlook remains highly uncertain," he said.

The yen's continued firmness hurt sentiment, sending leading exporters Toyota and Sony lower. Toyota Motor fell 0.91 percent to 2,910. Sony dropped 2.18 percent to 1,701 yen.

The dollar was weaker, trading around 77 yen or softer in Tokyo amid lingering caution that Japanese authorities may step into the market again to stem the negative impact on exporters.

Tokyo Electric Power, operator of the crippled Fukushima nuclear power plant, jumped 15.42 percent to 449 yen after its president Toshio Nishizawa said Tuesday that the company would not fall into negative net worth.

Japan Tobacco was up 6.06 percent at 350,000 yen after the Nikkei business daily reported the government was eyeing the sale of its holding in JT shares to help finance the nation's post-quake reconstruction.

The report said the company may move to purchase its own shares in order to sustain its share prices after the possible sale by the government.

 

Copyright AFP (Agence France-Presse), 2011

 

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