Tokyo stocks bounced back sharply Thursday, reflecting an overnight rebound on Wall Street prompted by a sharp upturn in crude oil prices.
The Nikkei average of 225 selected issues listed on the first section of the Tokyo Stock Exchange gained 291.49 points, or 1.52 percent, to end at 19,429.44, after losing 142.83 points on Wednesday.
The Topix index of all TSE first-section issues closed up 19.08 points, or 1.36 percent, at 1,425.98. It lost 8.99 points the previous day.
Tokyo stocks enjoyed a strong start, supported by a climb in the U.S. stock market on Wednesday on the back of crude oil market strength, as well as by a weaker yen, brokers said.
The June contract on West Texas Intermediate crude oil futures skyrocketed by some 19 percent after tumbling on Tuesday. The surge came after U.S. President Donald Trump said on Twitter, “I have instructed the United States Navy to shoot down and destroy any and all Iranian gunboats if they harass our ships at sea.”
Investor sentiment was also brightened somewhat by heightened expectations for a restart in business activities in the United States, which are currently on hold because of the coronavirus pandemic, in response to remarks by U.S. Treasury Secretary Steven Mnuchin that he expects most of the economy to reopen by late summer, brokers said.
Both market indexes fluctuated within narrow ranges far above Wednesday’s closing levels in the afternoon, amid a dearth of strong market-moving incentives.
“A wait-and-see mood prevailed among market players ahead of earnings releases by Japanese companies next week,” Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., noted.
Brokers also said the market’s upside was weighed down by a drop in Dow Jones industrial average futures in off-hours trading and the ever-rising number of coronavirus infection cases in Japan.
Rising issues far outnumbered falling ones 1,866 to 263 in the TSE’s first section, while 39 issues were unchanged.
Volume fell to 1.172 billion shares from Wednesday’s 1.247 billion shares.
Oil names attracted strong purchases, thanks to a rise in crude oil prices, with Inpex jumping 6.01 percent and Cosmo Energy 4.92 percent.
Technology issues, including Murata Manufacturing and TDK, rose, thanks to the brisk performances of their U.S. peers.
Among other major winners were internet service firm CyberAgent and automaker Honda.
On the other hand, Eisai lost 8.90 percent, after U.S. pharmaceuticals firm Biogen announced a delay in filing for approval of an Alzheimer’s disease drug that is currently being codeveloped with the Japanese drug maker.
Also on the negative side were job information service firm Recruit Holdings and daily goods maker Kao.
In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average rose 420 points to end at 19,440.
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