Business / Financial Markets | TSE DATA & REPORT

Tokyo stocks rebound on continued Wall Street advance

JIJI

Stocks bounced back on the Tokyo Stock Exchange on Thursday, helped by an extended rally on Wall Street.

The 225-issue Nikkei average rose 64.29 points, or 0.30 percent, to end at 21,702.45, after plunging 116.11 points Wednesday.

The Topix index of all first-section issues finished up 10.24 points, or 0.65 percent, at 1,589.78. It dropped 10.30 points the previous day.

Stocks spurted at the outset, as investors cheered the Dow Jones Industrial Average rewriting an all-time closing high in its four-day winning streak on the New York Stock Exchange on Wednesday.

A weaker-than-expected U.S. nonfarm payroll rise in June shown in an Automatic Data Processing Inc. survey and the bleak nonmanufacturing index for the same month released by the Institute for Supply Management made players believe more firmly that the U.S. Federal Reserve will carry out an interest rate cut to stimulate the economy at its Federal Open Market Committee meeting later this month, brokers said.

The Tokyo market soon bowed to profit-taking. But it remained on the sunny side throughout the day’s session.

Trading was lackluster without active participation by many foreign players on the eve of the Fourth of July holiday in the United States, brokers said.

“The market failed to extend gains after the initial spurt due to a dearth of fresh trading incentives,” said Ryuta Otsuka, strategist at the investment information department of Toyo Securities Co.

He said investors retreated to the sidelines to wait for the U.S. Labor Department’s employment report for June, due out Friday, and further announcements of earnings results by Japanese companies.

Rising issues outnumbered falling ones 1,599 to 467 in the TSE’s first section, while 83 issues were unchanged.

Volume dropped to 822 million shares from Wednesday’s 1.008 billion shares.

SoftBank Group was boosted 3.44 percent by a news report that the U.S. Justice Department may soon approve a merger between Sprint Corp., its U.S. mobile phone unit, and peer T-Mobile U.S. Inc.

Furniture retailer Nitori gained 3.95 percent after it released brisk business results for March-May.

Also on the positive side were conveyor-belt sushi restaurant chain Sushiro Global Holdings and shipping firm Kawasaki Kisen.

On the other hand, precision processing equipment manufacturer Disco fell for the second consecutive session after it reported a sales drop in April-June.

Among other noticeable losers were tire-maker Bridgestone and clothing store chain Fast Retailing.

In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average rose 80 points to end at 21,670.