Tokyo stocks added moderate gains Wednesday thanks to the yen’s weakening and unabated expectations for progress in the ongoing U.S.-China trade negotiations.
The 225-issue Nikkei average rose 51.83 points, or 0.22 percent, to end at 23,303.82. On Tuesday, the key market gauge surged 401.22 points.
The Topix index of all issues listed on the first section of the Tokyo Stock Exchange inched up 0.29 point, or 0.02 percent, to 1,694.45, after advancing 27.66 points the previous day.
Stocks got off to a higher start as investors took heart from Wall Street’s extension of a record-breaking winning streak amid persistent hopes for an end to the U.S.-China trade war. The stronger-than-expected U.S. nonmanufacturing index for October released by the Institute for Supply Management also fueled U.S. equities’ advance, brokers said.
Profit-taking pressure grew after the early morning spurt. Although the Nikkei managed to head north again in the afternoon, the Topix index remained in negative territory for most of the afternoon session.
But the yen’s drop against the dollar underpinned the market throughout the day, brokers said.
Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc., observed that trading was relatively calm because of the absence of news on the U.S.-China trade front.
“Market participants were waiting for new developments,” Fujii said.
Yutaka Miura, senior technical analyst at Mizuho Securities Co., noted that the Nikkei’s rise was limited as the Shanghai market’s fall cautioned investors not to be overoptimistic about the U.S.-China trade talks.
On the TSE’s first section, falling issues slightly outnumbered rising ones 1,039 to 1,009 while 106 issues were unchanged. Volume dropped to 1.388 billion shares from Tuesday’s 1.660 billion shares.
Mitsubishi UFJ Financial Group Inc. and other megabank groups were pushed up by a rise in U.S. long-term interest rates.
Sharp Corp. jumped 13.48 percent after Mizuho Securities raised its target price for the electronics stock.
Clothing store chain Fast Retailing Co. and industrial robot producer Fanuc Corp. were also bought.
But beverage maker Asahi Group Holdings Ltd. dropped 6.06 percent, as its January-September operating profit failed to beat a market consensus.
Among other major losers were automaker Suzuki Motor Corp. and technology firm Fujifilm Holdings Corp.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average fell 20 points to end at 23,300.