Tokyo stocks extended their winning streak to a fifth session Monday following Democratic candidate Joe Biden’s declaration of victory in the U.S. presidential election, with the Nikkei’s retaking of the 25,000 line coming in sight.
The 225-issue Nikkei average of the Tokyo Stock Exchange surged 514.61 points, or 2.12%, to close at 24,839.84, a level unseen since Nov. 5, 1991. On Friday, the key index advanced 219.95 points.
The Topix index of all TSE first section issues finished up 23.41 points, or 1.41%, at 1,681.90, after gaining 8.55 points the previous trading day.
Following Biden’s victory declaration Saturday, investors rushed to buy a wide range of stocks immediately after the opening bell, on the back of receded fears over post-election political turmoil in the United States.
Tokyo stocks gained a further momentum in the afternoon thanks to buying induced by jumps in other Asian stock markets, with the Nikkei briefly shooting up over 600 points to levels slightly below the 25,000 threshold.
A rise in U.S. Dow Jones Industrial Average futures in off-hours trading also gave support to the market, brokers said.
“Foreign investors, who put active trading on halt before the election, have regained vigor,” an official at a major securities firm said.
“The market was also pushed up by expectations that the Biden administration will hammer out powerful fresh stimulus measures,” another brokerage firm official noted.
Pointing out that the Nikkei rocketed over 1,860 points in only five sessions, Yutaka Miura, senior technical analyst at Mizuho Securities Co., said, “The Nikkei can extend the rally if the Dow tops 29,000.”
Miura also noted that incumbent U.S. President Donald Trump’s legal attempts for re-election and other developments that matter Trump “are regarded by many market participants as mere ‘background noise.'”
“Players are now closely watching the Biden administration’s roster, particularly who will be the treasury secretary,” he said.
On the TSE first section, gainers overwhelmed decliners 1,399 to 695 with 85 issues unchanged. Volume inched down to 1.227 billion shares from Friday’s 1.232 billion shares.
Automakers Honda and Isuzu soared 9.42% and 2.36%, respectively, as investors cheered their rosier operating profit outlooks for the year ending March 2021.
After announcing a share buyback plan, Nippon Telegraph and Telephone climbed 4.86%.
Technology investor SoftBank Group and clothing store chain Fast Retailing also rose.
On the other hand, Eisai was pushed down 23.64% by a U.S. Food and Drug Administration advisory committee’s negative comment on an Alzheimer’s medicine it is developing with U.S. partner Biogen.
Also sold were airline carrier JAL and electronics maker Sharp.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average soared 520 points to end at 24,860.
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