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Nikkei rises after overcoming ex-dividend impact

JIJI

Stocks overcame the ex-dividend impact near the fiscal yearend to finish with modest gains Wednesday, helped by a Wall Street gain overnight and a weakening of the yen.

The Nikkei 225 average closed up 22.17 points at 12,493.79. The Topix rose 2.05 points to end at 1,046.47. The Nikkei opened slightly higher after the Dow Jones industrial average rewrote its all-time closing high Tuesday on better than expected U.S. economic indicators.

The TSE was also supported by the weaker yen on the back of hopes for bolder monetary easing by the Bank of Japan. The key index swung narrowly between positive and negative territory.

Stocks going ex-dividend on the day led to drops of slightly less than 90 points of the Nikkei and about 9 points of the Topix, brokers said.

“In light of this impact, the market was solid as a whole,” said Toshiyuki Kanayama, a market analyst for Monex Inc.

Shares of some companies that close their books in March met selling by investors who have secured the rights to receive dividends and shareholder perks, but investors’ appetite for buying on dips was strong, brokers said.

The market received continued support from hopes for the BOJ’s more aggressive monetary easing and for better corporate earnings in the next fiscal year thanks to the yen’s continued weak trend, they said.

The market gauges have moved relatively narrowly so far this week as “investors await fresh incentives ahead of key events next week, including the central bank’s policy-setting meeting,” Kanayama said.

Winners edged out losers 842 to 776 on the first section, while 70 issues were unchanged. Volume fell to 2.483 billion shares from Tuesday’s 2.987 billion.

Aeon soared 6.33 percent after a newspaper report that the major retailer plans to make Daiei a subsidiary by acquiring an additional stake of 24 percent through a tender offer. Daiei tumbled 9.78 percent.

10-year yield drops

Japanese government bonds extended gains Wednesday, driving down a benchmark 10-year JGB yield to the lowest point in nearly a decade, on strong expectations of bolder monetary easing by the Bank of Japan.

The yield on the latest 328th 10-year JGB issue with a 0.6 percent coupon dropped to 0.515 percent in late interdealer trading, the lowest for a key 10-year JGB yield since June 18, 2003.