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Nikkei breaks out of three-session losing streak

JIJI

Stocks staged a rebound Wednesday, helped by buybacks on the back of a weakening of the yen against other major currencies.

The Nikkei 225 average closed up 161.45 points, or 1.22 percent, at 13,382.89, snapping a three-session losing streak. The Topix climbed 16.81 points, or 1.50 percent, to end at 1,136.01.

Stocks attracted purchases from the outset of Wednesday’s trading on the heels of hefty gains in U.S. equities overnight, buoyed by brisk corporate earnings and better than expected housing starts data for March.

Investors bought back mainstay component issues of the Nikkei, including automakers and banking groups, amid the yen’s easing against the dollar and the euro.

After moving in a narrow range, the key indexes extended gains in the middle of afternoon trading, bolstered by buying stemming from the yen’s further drop, brokers said.

“The Tokyo market regained its composure” after investor sentiment was unnerved by the bomb explosions at the Boston Marathon on Monday, said Masashi Oguchi of Mito Securities Co.’s investment information department.

Still, Wednesday’s rise was no more than a technical rebound after the Nikkei tumbled more than 300 points in three sessions through Tuesday, an official at an online brokerage said.

Investors’ eyes are fixed on a two-day meeting of finance ministers and central bank chiefs from the Group of 20 economies from Thursday in Washington, brokers said.

“Market sentiment is expected to improve drastically if the dollar tops ¥100 before the meeting. But I believe the dollar will keep hovering around ¥98 for the time being,” Oguchi said.

Rising issues overwhelmed falling ones 1,361 to 286 in the first section, while 66 issues were unchanged. Volume decreased to 3.802 billion shares from Tuesday’s 4.359 billion.

JGBs lack direction

Japanese government bonds moved aimlessly Wednesday amid a dearth of major trade incentives.

After moving around Tuesday’s closing level, the lead June futures contract on 10-year JGBs finished flat at 144.09. Volume fell to 22,193 contracts from 33,473.

In late interdealer trading in cash JGBs, the yield on the latest 328th 10-year issue with a 0.6 percent coupon stood at 0.590 percent, unchanged from late Tuesday.