Business / Financial Markets | TSE DATA & REPORT

Nikkei rises after Wall Street surges on U.S.-China trade talk news

JIJI

Stocks bounced back Friday after getting a boost from an overnight rise in U.S. equities.

The 225-issue Nikkei average gained 78.34 points, or 0.35 percent, to end at 22,270.38 on the Tokyo Stock Exchange, advancing for the first time in three days. On Thursday, it edged down 12.18 points.

The Topix index of all first-section issues added 10.38 points, or 0.62 percent, to finish at 1,697.53 after dipping 10.88 points the previous day. It posted the first rise in three sessions as well.

Investor sentiment was lifted by Wall Street’s advance on Thursday, which was backed by receding worries about U.S.-China trade friction following news that the world’s two biggest economies will resume trade talks, market sources said.

The Tokyo market’s firmness reflected “hopes for the U.S.-China trade talks and the stability of the Turkish lira,” an official of a bank-linked securities firm said.

A media report said that two days of talks would be held between Washington and Beijing starting Wednesday.

Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co., pointed to the absence of futures-led selling, noting the Turkish currency had regained its stability.

Still, the market’s topside was capped by a dearth of fresh positive incentives, Ichikawa said.

Some market sources noted that the rise in Tokyo stocks was relatively limited compared with Wall Street, where the Dow Jones industrial average surged 396.32 points, or 1.58 percent, overnight because news about the planned resumption of U.S.-China talks had already reached Tokyo on Thursday.

In addition, concerns over the trade dispute between the United States and China have not been fully dispelled, and the turmoil in Turkey remains a possible selling factor, brokers said.

Rising issues overwhelmed falling ones 1,498 to 523 on the TSE’s first section, while 82 issues were unchanged.

Volume dropped to 1.116 billion shares from Thursday’s 1.546 billion shares.

Kyowa Hakko Kirin was buoyant partly because Mizuho Securities raised its target price for the drugmaker’s stock.

Financial issues, such as megabank Mitsubishi UFJ, and insurers Tokio Marine and Dai-ichi Life, attracted purchases.

Firms with a major presence in China were hunted due to the expected restart of U.S.-China trade talks. They included industrial robot maker Fanuc, control equipment manufacturer SMC and construction machinery maker Komatsu.

Other major winners included pharmaceutical company Astellas and air conditioner maker Daikin.

By contrast, semiconductor-related Tokyo Electron and Screen were downbeat after U.S. peers Nvidia and Applied Materials released on Thursday disappointing sales estimates for August-October.

Also on the minus side were clothing retailer Fast Retailing and automaker Suzuki.

In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average was up 100 points at 22,260.