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Tokyo stocks rise, but topside limited


Stocks closed slightly higher on the Tokyo Stock Exchange Wednesday thanks to buying on dips after early falls, with their topside limited by growing concern over market overheating.

The 225-issue Nikkei average rose 20.13 points, or 0.10 percent, to end at 19,691.39. On Tuesday, the key market gauge gained 28.52 points.

The Topix index of all first-section issues climbed 5.84 points, or 0.37 percent, to 1,595.32, after losing 1.49 points the previous day.

Tokyo stocks got off to a weaker start, weighed down by selling to lock in gains from the recent advance.

By the middle of the morning session, stocks wiped out the losses thanks to buying on dips on the back of hopes for economic stimulus measures by the Japanese government.

After repeating small ups and downs around the previous day’s closing levels, the key indexes gained ground slightly in the afternoon.

Throughout Wednesday, he market’s topside was capped by increasing worries about market heating after the Nikkei average advanced for five straight sessions through Tuesday, brokers said.

Stocks moved in a narrow range as active purchases were held in check due to a lack of fresh incentives. A pause in the yen’s falls also pressured the topside of the market, according to brokers.

Despite these factors, “the market maintained its firmness, supported by continued buybacks from foreign investors,” said Kenichi Hirano, market analyst at K Asset Co.

“Foreign investors have helped the market to gain force on such expectations as for economic stimulus measures and additional monetary easing steps,” Hirano added.

But an official of a bank-affiliated securities firm said that the Nikkei average needs to go through a short-tem correction so that it will gain a firm foothold above the 20,000 line.

Rising issues outnumbered falling ones 1,243 to 557 in the TSE’s first section, while 112 issues were unchanged.

Volume increased to 2.14 billion shares from Tuesday’s 2.07 billion shares.

Oil company Inpex, realtors Mitsui Fudosan and Mitsubishi Estate, and mega-banks Sumitomo Mitsui and Mizuho were buoyant, along with food producer Meiji Holdings and engineering firm JGC.

Mitsubishi Heavy Industries was also on the plus side after the Mitsubishi Regional Jet, the first Japanese-developed small passenger jet jointly produced by subsidiary Mitsubishi Aircraft, made a successful debut flight on Wednesday morning.

Toray Industries surged after concluding a contract with U.S. aerospace giant Boeing to provide carbon fiber for more than 10 years, brokers said.

By contrast, automaker Toyota, industrial robot-maker Fanuc and camera-maker Canon were downbeat.

Other major losers included mobile phone carrier SoftBank and clothing store chain operator Fast Retailing, both heavily weighted components of the Nikkei average.

In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average rose 40 points to close at 19,740.