Tokyo stocks end higher as fears of a US rate hike abate
TOKYO (Kyodo) – Tokyo shares closed higher on Monday as fears of an earlier-than-expected U.S. interest rate hike eased following comments from U.S. Federal Reserve Chairman Jerome Powell.
The 225-number Nikkei Stock Average finished 148.15 points, or 0.54%, higher from Friday at 27,789.29. The largest Topix index of all issues in the first section of the Tokyo Stock Exchange finished 21.37 points, or 1.11 percent, up to 1,950.14.
All categories of industries gained ground, led by the problems of iron and steel, shipping and non-ferrous metals.
The U.S. dollar remained in the upper 109 yen range as investors sold the unit after Powell’s comments lowered U.S. Treasury yields, fueling speculation that the interest rate differential between US and Japan would shrink, brokers said.
At 5 p.m., the dollar hit 109.80-82 yen against 109.80-90 yen in New York and 110.10-11 yen in Tokyo on Friday at 5 p.m.
The euro was listed at $ 1.1801-1803 and 129.58-62 yen against $ 1.1793-1803 and 129.50-60 yen in New York and $ 1.1760-1762 and 129.48-52 yen in Tokyo late Friday afternoon.
The yield on the benchmark 10-year Japanese government bond fell 0.005 percentage points from nearly 0.015% on Friday, following a drop by U.S. counterparts late last week following Powell’s comments.
Stocks rose on Wall Street’s advances at the end of last week, but slashed gains as market participants moved to lock in profits after the Nikkei briefly broke the 27,900 mark.
“Investors were relieved to hear the conciliatory remarks from Fed Chairman Powell as they eased fears that the central bank might decide to cut its stimulus package in September,” Shingo Ide said, chief equity strategist at the NLI Research Institute.
Powell practically addressed the Fed’s Jackson Hole symposium on Friday, saying the bank was about to start phasing out stimulus measures, but added that the move “will not be intended to send a direct signal about when interest rates take off “.
However, market participants are reluctant to take any significant action pending the release of the Chinese Purchasing Managers Index and US employment data for August, respectively, on Tuesday. and Friday, said Ide.
On the first section, the increasing emissions outnumbered the declines from 1,853 to 279, while 55 ended unchanged.
Some chip-related issues increased after the tech-rich Nasdaq Index hit a record high in New York on Friday. Sumco climbed 41 yen, or 1.8%, to 2,326 yen, Tokyo Electron gained 490 yen, or 1.1%, to 46,570 yen, and Screen Holdings rose 170 yen, or 1.8% , at 9,380 yen.
Main section trading volume rose to 1,021.74 million shares from 869.85 million shares on Friday.