Wed, 25 Nov 2020

Tokyo shares rise on US stimulus hopes

News24
21 Oct 2020, 18:12 GMT+10

Tokyo shares closed higher Wednesday on renewed hopes for a US stimulus package that also fuelled gains on Wall Street, and optimism over the development of coronavirus vaccines.

The benchmark Nikkei 225 index closed 0.31%, or 72.42 points, higher at 23 639.46, while the broader Topix index gained 0.73%, or 11.86 points, to 1 637.60.

"The Nikkei average started the day with buy orders leading the way after major US indices all surged overnight on hopes for additional economic measures," Okasan Online Securities said in a note.

In a dramatic political development, US House Speaker Nancy Pelosi told media that lawmakers were starting to write stimulus-spending legislation, and voiced optimism that it can win bipartisan support.

If a deal is reached, Tokyo stocks would gain further, although investors may refrain from major market moves until after the US election, Okasan said.

On Tuesday, perceived uncertainty around the US stimulus-package negotiations had driven down the Tokyo market, SMBC Nikko Securities said in a note.

But "optimism returned and encouraged buying" on Wednesday, it added.

Buying did not last beyond the 23 700 mark, where players began to lock in profit.

"A mix of profit-taking and bargain-hunting kept the index in a narrow range," Okasan said.

"The afternoon session lacked news, and the index stayed within the current range through the closing bell."

The dollar fetched ¥105.22, down slightly from ¥105.45 in New York on Tuesday.

A broad range of shares enjoyed solid gains, with 31 of the 33 business sectors recognised by the Tokyo Stock Exchange marking rises.

Steel, mining and marine transportation issues performed particularly well.

Nippon Steel surged 3.25% to ¥1 126.5. Shipping firm Nihon Yusen Kabushiki Kaisha reached its yearly high at ¥2 021, up 2.85%.

Toyota added 1.62% to ¥7 009. Mitsubishi UFJ Financial Group advanced 1.75% to ¥424.9.

Chipmaker Rohm jumped 4.79% to 8 750 after it revised up earning forecasts.

Sony gave up earlier gains and ended down 0.05% at ¥7 896, while SoftBank Group fell 0.71% to ¥7 089.

Source: News24

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