Tokyo stocks rose further on Monday thanks to U.S. equities’ bull run late last week while the market lacked a clear direction.
The 225-issue Nikkei average gained 49.14 points, or 0.17%, to finish at 29,766.97, after surging 506.19 points Friday.
The Topix index of all first section issues closed 17.67 points, or 0.91%, higher at 1,968.73, following a 26.14-point advance the previous trading day.
Both the Nikkei and the Topix finished higher for the fifth straight trading day.
The market started on a stronger note, with investors heartened by the U.S. Dow Jones Industrial Average’s finish at a record high for the third straight day on Friday as hopes for the economic recovery grew after U.S. President Joe Biden signed the $1.9 trillion coronavirus relief package into law Thursday, brokers said.
Investors were increasingly hopeful for an economic turnaround after Biden vowed last week to make all Americans who are 18 or over eligible to receive coronavirus vaccines by May 1, they added.
While profit-taking pressure increased later to cause the Nikkei to slip into negative territory, the yen’s slight weakening helped the index move above Friday’s closing for most of Monday’s session.
Trading was lackluster in general, however, because many investors were reluctant to tilt their positions either way ahead of policy-setting meetings of the central banks of the United States and Japan this week, brokers said.
The downside of the market, especially that of the Topix index, saw support throughout the day from the popularity of financials, automakers and other undervalued stocks reflecting hopes for the U.S. economic recovery, they said.
On the other hand, Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., said, “The market’s topside was capped by selling of chip-related and other high-tech issues sparked by a fall in the (tech-heavy) U.S. Nasdaq composite index Friday in the wake of a spike in U.S. long-term interest rates.”
On the TSE first section, gainers far outnumbered decliners 1,800 to 338, while 57 issues were unchanged. Volume decreased slightly to 1.541 billion shares from Friday’s 1.582 billion shares.
Megabank groups drew active buying, with Mitsubishi UFJ rising 4.12%, Sumitomo Mitsui Financial 3.55% and Mizuho Financial 2.80%.
Nintendo advanced for the fourth consecutive trading day, backed by a media report that the company is stepping up efforts to post record-high sales of its Nintendo Switch and software for the video game machine in fiscal 2021.
Among other major winners were cybermall operator Rakuten and automaker Honda.
On the other hand, technology investor SoftBank Group and chipmaking gear-maker Tokyo Electron went down.
In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average fell 60 points to 29,530.
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