Tokyo stocks close at 32-month high
Tuesday, 15 January 2013
TOKYO: Tokyo stocks rose 0.72 percent Tuesday to a 32-month high, but the benchmark index gave up some early gains as the yen rebounded on warnings from Japan's economy minister over its decline.
The Nikkei 225 gained 77.51 points to 10,879.08, finishing at its highest level since April 30, 2010, while the the broader Topix index of all first-section shares climbed 0.84 percent, or 7.53 points, to 906.22.
The yen, which fell in morning trade on easing speculation, rebounded after Economy Minister Akira Amari said the yen's sharp decline could hit consumers by making imported goods more expensive as the economy stumbles.
"Obviously, an excessively weak yen will be reflected in import prices," Amari told a regular Tokyo press briefing.
"It might help exports, but it could also have negative effects on the lives of the public."
A weakening yen tends to boost the local stock market because it makes Japanese exporters' products more competitive overseas.
The dollar -- which changed hands at 89.56 yen in morning trade -- dropped to 88.74 yen, while the euro was lower at 118.47 in late afternoon Tokyo trade, from 119.93 yen on Tuesday morning.
The yen had initially weakened after Bank of Japan (BoJ) governor Masaaki Shirakawa said the central bank would pursue "aggressive" monetary easing to boost the world's third-largest economy.
While his comments are not new, they fuelled speculation of more policy moves -- which tend to weaken the yen -- after the BoJ's meeting on next week.
The Tokyo market has been winning support as Japan's new government vows to fix the long-suffering economy with its extra budget expected to be approved later Tuesday after a holiday-extended weekend.
"There was quite a bit of pent-up demand for stocks over the long weekend," said an equity trader at a foreign brokerage.
"Traders are eyeing US corporate earnings this week, while awaiting the Abe Cabinet's supplementary budget approval, which adds a bit of realism to Prime Minister Abe's aggressive pledges to help the economy."
Tokyo has unveiled a $226.5 billion stimulus plan in the latest bid to boost the world's third-biggest economy, with plans to create hundreds of thousands of jobs, rebuild disaster-hit areas and beef up the military.
In Tokyo trade, Sony was up 1.22 percent at 995 yen, Takeda Pharmaceutical advanced 2.57 percent to 4,380 yen while investment banking giant Nomura Holdings added 0.81 percent at 494 yen.
Toyota ended 0.11 percent higher at 4,265 yen, with Japan's biggest automaker boosted by news it surpassed General Motors to regain top spot in the global carmakers' sales table.
All Nippon Airways was up 0.54 percent at 185 yen while Japan Airlines was down 0.68 percent to 3,610 yen after the carriers suffered a string of recent safety incidents involving Boeing's flagship Dreamliner aircraft. (AFP)