Tokyo stocks advanced further on Monday, reflecting a climb on Wall Street late last week.
The 225-issue Nikkei average rose 160.52 points, or 0.55%, to end at 29,518.34, extending its winning streak to a third straight market day. The key market gauge inched up 26.45 points Friday.
The Topix index of all issues on the first section of the Tokyo Stock Exchange ended up 19.22 points, or 0.99%, at 1,952.27, following a 5.65-point rise the previous trading day.
Tokyo stocks got off to a firm start, aided by rises in all three major U.S. stock indicators Friday — of which the Dow Jones industrial average and the S&P 500 index rewrote their record highs. The U.S. indexes’ strong performances came as growth stocks, in particular, attracted buying, after the Labor Department’s announcement of far weaker-than-expected growth in April’s U.S. nonfarm payrolls eased concerns over a rise of long-term interest rates.
The Nikkei climbed over 300 points at one point in the morning. But the key market gauge failed to extend gains in the afternoon, with its upside capped by profit-taking of heavyweight semiconductor names such as chipmaking gear manufacturer Tokyo Electron. Firms in the sector rose in the morning, reflecting a three-day rally until Friday of the U.S. SOX Philadelphia semiconductor index.
“The Tokyo market as a whole was also supported by rises in Dow futures in off-hours trading and in Chinese stock markets,” said Maki Sawada, strategist at Nomura Securities Co.
“Some heavyweight Nikkei components came under profit-taking pressure amid the absence of fresh buying incentives,” Sawada added.
Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., said, “A wait-and-see mood grew among market players in the afternoon ahead of earnings announcements by more companies later in the week.”
“Investors are becoming increasingly sensitive to earnings estimates,” Ichikawa added, referring to the day’s plunges in shipping firms Kawasaki Kisen and Nippon Yusen that came after their earnings estimates for the current fiscal year ending in March 2022 failed to meet market consensuses.
In the TSE’s first section, gainers overwhelmed losers 1,482 to 614, while 95 issues stayed unchanged. Volume decreased slightly to 1.126 billion shares from Friday’s 1.174 billion shares.
Oil names climbed as expectations for higher crude oil prices grew after a crucial U.S. pipeline was brought offline by a cyberattack, with Eneos and Idemitsu increasing 3.53% and 2.67%, respectively.
Office equipment manufacturer Ricoh soared 5.75% after it said Friday that it expected to swing back to a net profit in the year ending in March 2022.
Steel-makers Nippon Steel and JFE also attracted buying.
Meanwhile, Kawasaki Kisen dropped 6.36% and Nippon Yusen sank 3.18%.
Food & Life fell 3.57% after food poisoning cases were reported at an outlet of the company’s Sushiro conveyor-belt sushi restaurant chain.
In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average gained 180 points to end at 29,570.
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