The key Nikkei average extended its winning streak to an 11th session to rewrite its highest closing level in more than 15 years for the eighth consecutive trading day on the Tokyo Stock Exchange on Friday, thanks to buying backed by brisk corporate earnings.
The Nikkei 225 edged up 11.69 points, or 0.06 percent, to close at 20,563.15, the best finish since April 12, 2000. The Topix index of all first-section issues closed up 0.89 point, or 0.05 percent, at 1,673.65.
Tokyo stocks opened lower after Chinese, U.S. and European equities dropped the previous day. After the initial selling ran its course, the Nikkei popped up into positive territory and rose above 20,600 in midmorning trading thanks to buying on dips on persistent expectations for further stock price gains.
In the afternoon, however, the market’s upside was capped by profit-taking following the recent surge and position-adjustment selling ahead of the weekend.
The Nikkei’s winning streak, the longest in about 27 years, was supported by “improved domestic corporate earnings, signs of Japanese economic recovery, such as strong gross domestic product data for January to March, and the favorable supply-demand balance,” said Tomoaki Fujii, head of the corporate research division at Takagi Securities Co.
Several technical charts suggested signs of market overheating after the Nikkei surged some 981 points in the 10 sessions through Thursday.
But Fujii said: “I think the real sense of market overheating is not so strong as indicated by the charts. The Nikkei’s gains on each session were not very large.”
Analysts believe the key average is likely to surpass 20,833, the closing level on April 12, 2000, as early as next week. In June, Tokyo stocks are expected to receive another boost from expectations that many companies will launch measures to increase shareholder returns, such as dividend hikes, toward annual shareholders’ meetings, an official at a Japanese securities firm said.
Rising issues outnumbered falling ones 970 to 774 in the first section, while volume increased to 3.291 billion shares from Thursday’s 3.119 billion shares.
Nonferrous metal producer Mitsubishi Materials jumped over 3 percent to rewrite its year-to-date high for the second straight session on higher copper prices in London. Rival Dowa Holdings also enjoyed handsome gains. Mega-bank groups Mizuho and Mitsubishi UFJ were buoyant, along with clothing retailer Fast Retailing, mobile carrier Softbank and robot maker Fanuc.
On the other hand, selling stemming from a halt in the yen’s falls hit automaker Toyota and Honda and camera maker Canon. Other major losers included Japan Tobacco, drug maker Takeda and daily goods producer Kao.