Tokyo stocks extended their winning streak to a fourth session Thursday, as investors hailed a further rise in U.S. equities and the yen’s drop against the dollar.
The Nikkei average of 225 selected issues listed on the first section of the Tokyo Stock Exchange gained 81.98 points, or 0.36 percent, to end at 22,695.74, after rising 288.15 points Wednesday.
The Topix index of all TSE first-section issues finished 4.74 points, or 0.30 percent, higher at 1,603.82, following an 11.40-point jump the previous day.
The Tokyo market opened sharply higher, after the U.S. Dow Jones industrial average shot up more than 2 percent Wednesday to retake 26,000 for the first time in about three months in an unabated risk-on mood reflecting rosy economic prospects.
Although profit-taking pressure quickly built up, the market returned to positive terrain in the afternoon as investors stepped up buying in view of the dollar’s advance to top ¥109, brokers said.
“Huge funds provided by the central banks in major economies through their enhanced quantitative easing have been poured into stock markets across the globe,” said Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc.
An official at a midsize brokerage firm expressed caution over such a fast market recovery from the global collapse in March caused by the coronavirus crisis.
But Fujii gave a bullish outlook for the near term, saying, “A major sell-off is unlikely to hit the market for now, unless a full coronavirus lockdown is brought back in the United States.”
“Stock investment will remain bullish as long as where to spend money is limited due to phased reopening of business activities,” another securities firm official noted.
On the TSE’s first section, rising issues slightly outnumbered falling ones 1,032 to 1,026, while 111 issues were unchanged. Volume decreased to 1.516 billion shares from Wednesday’s 1.552 billion shares.
Automaker Toyota, technology and entertainment giant Sony and other export-oriented issues attracted purchases thanks to economic recovery hopes.
Financials including megabank group Mitsubishi UFJ and insurer Tokio Marine benefited from their U.S. peers’ rises on Wednesday.
Among other winners were technology investor SoftBank Group and clothing store chain Fast Retailing.
By contrast, apartment rental firm Leopalace21 plummeted after revising down its net loss estimate for the year that ended in March.
Also on the negative side were drug maker Eisai and camera maker Canon.
In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average rose 30 points to end at 22,760.