Tokyo stocks close up 0.85pc

August 21, 2014 - 10:20:21 am

TOKYO: Tokyo stocks rose 0.85 percent on Thursday after the dollar jumped against the yen on speculation that the US central bank may raise interest rates earlier than expected.

The Nikkei 225 index was up 131.75 points to 15,586.20, notching up a ninth straight day of gains. The Topix index of all first-section issues climbed 0.90 percent, or 11.55 points, to 1,291.19.

The greenback was trading at 103.86 yen in Tokyo, up from 103.76 yen in New York late Wednesday and up from 103.23 yen in Tokyo on Wednesday.

A weak yen is a strong buy signal for Japanese exporters as it makes their products more competitive abroad and inflates profits when repatriated.

"A strong dollar remains the single most powerful Japan stock-buying catalyst, as clearly illustrated in 2013," said Masayuki Doshida, senior market analyst at Rakuten Securities.

In 2013 Japanese shares soared 57 percent to post their best annual performance for more than four decades as the yen plunged in response to a massive monetary easing campaign by the Bank of Japan.

"There isn't a great deal of short-term room for more yen weakness, but there is enough to keep the current rally going," Doshida told Dow Jones Newswires.

The currency market reacted to hints from US Federal Reserve officials that a surprisingly strong jobs market recovery could lead it to raise interest rates earlier than anticipated.

In Tokyo trade, Sony rose 0.77 percent to 1,952.0 yen, while Toyota gained 0.65 percent to 5,990.0 yen.

Mitsubishi Heavy Industries jumped 1.73 percent to 645.6 yen after a newspaper said the defence ministry hopes to develop engines for a domestically-produced fighter jet in cooperation with Mitsubishi and others. (AFP)



 



 

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