Tokyo stocks turned higher Monday, pushed up by buybacks and “buying the dip” activities.
The 225-issue Nikkei average of the Tokyo Stock Exchange climbed 190.84 points, or 0.67%, to close at 28,822.29, the highest finish since Aug. 3, 1990. On Friday, the benchmark index surrendered 125.41 points.
The Topix index of all first section issues closed 5.36 points, or 0.29%, higher at 1,862.00 after falling 4.00 points the previous trading day.
After struggling for direction, the market headed north around midmorning as investors boosted repurchases of stocks they had sold earlier as well as moves to buy the dip in view of a rise in U.S. Dow Jones Industrial Average futures in off-hours trading, brokers said.
But the market later lost steam and got stuck in a narrow range while selling pressure was increasing amid a dearth of fresh trading incentives.
Although the Nikkei remained buoyant for the rest of Monday’s session thanks to the popularity of some component issues, including Fast Retailing, the Topix index temporarily sank into negative territory in the afternoon, brokers said.
“The market’s late range-bound moves reflected lackluster U.S. futures trading,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.
An online brokerage official and other sources noted that the day’s rebound was brought on by individual investors’ active buybacks of shares they dumped late last week and foreign players’ buying of bargains among stocks related to electronic parts.
Meanwhile, domestic corporate investors enhanced selling to lock in gains, an official at a bank-affiliated securities firm pointed out.
On the TSE first section, gainers far outnumbered decliners 1,449 to 654 while 87 issues were unchanged. Volume dropped to 1.016 billion shares from Friday’s 1.217 billion shares.
Drugmakers were sent higher by a media report that Eisai will start a clinical trial of its Alzheimer’s drug next month.
Sumitomo Metal Mining rose for the fifth consecutive trading session, after the company announced that it had confirmed significant gold mineralization in its Canadian exploration project.
Among other major winners were silicon wafer producer Shin-Etsu Chemical and electronic parts supplier Murata Manufacturing.
On the other hand, trading house Toyota Tsusho and cosmetics maker Shiseido succumbed to selling pressure.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average advanced 150 points to end at 28,780.
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