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Nikkei gains 214 points as U.S. worries ease

JIJI

Stocks gained further ground on the Tokyo Stock Exchange on Thursday as investor worries about the health of the U.S. economy eased.

The Nikkei average gained 213.61 points, or 1.28 percent, to end at 16,960.16. On Wednesday, it climbed 661.04 points.

The Topix finished up 19.44 points, or 1.44 percent, at 1,369.05, after advancing 48.78 points the previous day.

Stocks opened weaker, following the previous day’s surge and the yen’s ascent against the dollar, but then cut the losses and entered positive territory.

Investors took heart from an overnight rise in U.S. equities on the back of recent stability in crude oil prices and solid economic data, brokers said.

U.S. Automatic Data Processing Inc.’s private-sector jobs data, released on Wednesday, exceeded market expectations, raising hopes for solid numbers in the U.S. Labor Department’s jobs report, due out Friday, brokers said.

Stocks moved firmer for the rest of the day, though their topside grew slightly heavy at some points.

Since last week’s meeting of the Group of 20 finance ministers and central bank chiefs, “expectations have grown that China will take any fiscal action at the National People’s Congress,” said Masayuki Otani, chief market analyst at Securities Japan Inc. The meeting begins Saturday.

“There are also hopes for additional monetary easing by the (European Central Bank) next week and economic stimulus measures included in the Japanese government’s fiscal 2016 budget,” Otani said.

“Backed by such expectations, stocks drew continued buybacks after a stalemate in the past two weeks,” he said.

An official at a bank-affiliated securities firm said that sharp gains in banks also helped lift the market thanks to purchases apparently by pension funds.

“With recent stability in the yen’s exchange rate and crude oil prices, negative factors are gradually weakening,” Otani said.

Otani said that the Nikkei average is likely to test its upside to 17,400, seen as an important line in a recovery phase next week.

Rising issues far outnumbered falling ones 1,429 to 436 in the TSE’s first section, while 77 issues were unchanged.

Volume grew to 2,744 million shares from Wednesday’s 2,489 million shares.

Megabanks Mitsubishi UFJ, Sumitomo Mitsui and Mizuho, along with insurer Dai-ichi Life, surged after financial issues rose in European and U.S. markets on Wednesday.

Higher crude oil prices pushed up oil companies JX Holdings, Idemitsu Kosan and Inpex.

Clothing store chain operator Fast Retailing was also buoyant after announcing brisk February sales.

By contrast, railway operators JR Tokai and JR East, airline JAL and drug maker Takeda were downbeat.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average closed up 250 points at 16,990.