Tokyo stocks end higher but strong yen tempers gains
16 Mar 2017 - 11:21
Tokyo: Tokyo shares closed slightly higher Thursday but the gains were capped by a stronger yen after the Federal Reserve hinted at a slower pace of interest rate hikes this year.
An upbeat assessment of the Japanese economy by the country's central bank provided some cheer in the afternoon, helping traders reverse early losses. The Bank of Japan also held off fresh growth-boosting measures, in line with expectations.
The BoJ gathering came after the Fed raised borrowing costs for the second time in three months but suggested only another two rises this year, confounding talk of a possible three or four.
The news hammered the dollar, which bought 113.27 yen on Thursday, down from New York and well off levels above 115 yen seen earlier this week.
Tokyo's benchmark Nikkei 225 index gained 0.07 percent, or 12.76 points, to close at 19,590.14, while the Topix index of all first-section issues was up 0.09 percent, or 1.38 points, to end the session at 1,572.69.
All eyes are now on BoJ governor Haruhiko Kuroda's news briefing to see if he hints at when the bank might start tapering its huge asset-buying plan.
"The key market focus for Kuroda's presser will be on how long he sees the 80-trillion-yen bond buying as a sustainable policy," Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management, told Bloomberg News.
Nissan, more than 40 percent owned by Renault, fell 1.72 percent to 1,137.5 yen, following claims the French carmaker has cheated for more than 25 years on pollution tests with the knowledge of top management.
A report by French fraud investigators, obtained by AFP, implicated senior executives including CEO Carlos Ghosn, who has also held the top job at Nissan for years. He recently announced plans to quit the post but stay on as chairman.
Among exporters hurt by the stronger yen Panasonic slipped 0.19 percent to 1,267.5 yen while Honda lost 0.50 percent to end at 3,556 yen.
Banks were also down, with Mitsubishi UFJ Financial falling 1.17 percent to 765 yen.
Energy firms rose with oil prices. Refiner and distributor Showa Shell tacked on 1.32 percent to finish at 1,148 yen.
And Toshiba fell another 3.11 percent to 183.6 yen, after diving more than 12 percent the previous day on delisting fears.