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Nikkei ends above 17,000 on monetary easing hopes


Stocks gained ground on the Tokyo Stock Exchange on Monday, supported by hopes for additional monetary easing in Europe and Japan, with the benchmark Nikkei average closing above 17,000.

The 225-issue Nikkei climbed 152.38 points, or 0.90 percent, to end at 17,110.91, its first finish above 17,000 since Tuesday. On Friday, the key market gauge soared 941.27 points, posting the biggest single-day point gain since Sept. 9, 2015, when it skyrocketed 1,343.43 points.

The Topix index of all first-section issues finished up 18.44 points, or 1.34 percent, at 1,392.63, after jumping 72.70 points the previous trading day.

Tokyo stocks kicked off the week with gains after European and U.S. equities advanced Friday, backed by higher crude oil prices and expectations for additional monetary easing steps by the European Central Bank, as well as by the Bank of Japan, brokers said.

Investors also took heart from the yen’s drop, according to brokers.

After the initial buying ran its course, the Tokyo market briefly came under profit-taking pressure, pushing down the Nikkei average into negative territory at one point. But stocks erased the losses in the middle of the morning session and accelerated their upswing toward the morning close.

Stocks maintained their strength for the rest of the day, but their topside was limited somewhat in the afternoon ahead of the policy-setting meetings of the U.S. Federal Reserve and the BOJ this week, brokers said.

“Today’s rise reflected underlying hopes for additional monetary easing in Europe and Japan, with stocks attracting buybacks,” said Yoshihiko Tabei, chief analyst at Naito Securities Co.

An official of another securities firm said that if the BOJ decides to take additional monetary easing measures at the upcoming meeting, the Nikkei average is likely to get back on the upward trend.

“Investor sentiment also improved thanks to a growing belief that crude oil prices have bottomed out,” Tabei said.

Worries about an oversupply of oil retreated because of global cold waves, brokers said.

But Tabei noted that the Tokyo market still has the risk of hitting some turbulence this week, depending on the results of the upcoming monetary policy meetings in the United States and Japan.

Rising issues overwhelmed falling ones 1,643 to 229 in the TSE’s first section, while 63 issues were unchanged.

Volume dwindled to almost 2.3 billion shares from Friday’s 2.6 billion.

All 33 first-section sector subindexes closed higher.

Oil companies, such as JX Holdings and Inpex, attracted buying.

Japan Tobacco climbed on hopes for a strengthened revenue base after announcing last week prices hikes for its mainstay cigarette brand, market sources said.

Mobile phone carrier SoftBank Group drew buybacks after U.S. subsidiary Sprint surged in the U.S. market on Friday.

Other major winners included automakers Toyota and Fuji Heavy, clothing store chain operator Fast Retailing, and mega-banks Mitsubishi UFJ, Mizuho and Sumitomo Mitsui.

By contrast, automaker Honda, electronics and machinery producer Toshiba, industrial robot manufacturer Fanuc and airline JAL were downbeat.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average ended up 330 points at 17,180.