/ |

Tokyo stocks rise on weaker yen

JIJI

Stocks gained ground Tuesday, supported by buying of issues backed by a weaker yen.

The Nikkei 225 average rose 114.50 points, or 0.57 percent, to end at 20,195.48. On Monday, the key market gauge gained 151.89 points.

The Topix, which covers all first-section issues, finished 11.66 points, or 0.72 percent, higher at a year-to-date high of 1,627.14 after climbing 8.42 points Monday.

Stocks got off to a weak start, with trading lacking vigor amid a dearth of fresh buying incentives and ahead of a congressional testimony by U.S. Federal Reserve Chairwoman Janet Yellen, brokers said.

But the market soon took an upturn and accelerated its upswing in the afternoon thanks to purchases of export-oriented names amid the dollar’s firming against the yen and other incentive-backed stocks, they said.

“The afternoon market ascent can be attributed to futures-led buying” on top of the dollar’s rise close to ¥114.50, said Masayuki Otani, chief market analyst at Securities Japan Inc.

Otani warned of a downside risk, saying if trading volume remains low, the Nikkei may sink below 20,000 “even on minor news.”

“The market needs another boost for a further rise,” including from Yellen’s testimony, said Masahiro Ichikawa, senior strategist in Sumitomo Mitsui Asset Management Co.’s economic research department.

If Yellen makes a fresh remark on the Fed’s tapering of its balance sheet, the market may respond positively, Ichikawa said.

Rising issues far outnumbered falling ones 1,494 to 392 in the first section, while 135 issues were unchanged.

Volume fell to 1.436 billion shares from Monday’s 1.540 billion.

Automakers Toyota and Subaru attracted buying, as did industrial robot maker Fanuc and semiconductor-related Hoya.

Seiko Epson spurted 3.7 percent after the Nikkei business daily announced that it will replace Toshiba with Seiko Epson as a Nikkei average component.

Sony was also upbeat thanks to a robust box-office start of a new “Spider-Man” film.

Chugai Pharmaceutical attracted purchases on the positive clinical trial results for its hemophilia drug.

Machinery makers, information technology firms and materials producers were also buoyant.

By contrast, power and gas utilities were downbeat.

Pachinko and slot machine makers were also hit by selling following the National Police Agency’s announcement of a new regulation for the industry.