Thursday 28 Mar 2024
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Nikkei rises to 15-year high on foreign buying hopes; 20,000 in sight

 


TOKYO (Apr 9): Japan's Nikkei rose to a fresh 15-year high on Thursday morning, getting in sight of 20,000, after U.S. shares had modest gains and hopes rose that foreigners will continue to buying Japanese stocks.

The Nikkei 225 gained 0.7 percent to 19,918.59 in mid-morning trade after reaching 19,946.78, the highest since
April 2000.

Japan finance ministry data showed foreign investors bought
a net 1.036 trillion yen ($8.61 billion) of Japanese shares last week, their biggest net buying since early April 2013.

"The mood is helped by the fact that foreign investors are
coming back to the Japanese market after they turned sellers
early this year," said Hikaru Sato, a senior technical analyst at Daiwa Securities.

"Both foreigners and domestic investors are chasing the
market higher carefully now and see if the index touches the
20,000-mark," he said.

Analysts say foreigners such as hedge funds earlier this
year sold risky assets including Japanese stocks to deliver
profits to balance losses incurred in crude oil. But foreigners see positive leads in Japan such as an economic recovery based on weak oil prices and rising wages.

"What's not priced in is corporate earnings forecasts for
this fiscal year," said Hiroyuki Nakai, chief strategist at
Tokai Tokyo Research Center who expects a 15-20 percent rise in corporate profits for the year ending March 2016.

On Wednesday, U.S. shares rose in a volatile session during
which minutes from a U.S. Federal Reserve meeting cemented
expectations that it remained on track for a interest rate hike this year.

Fed officials acknowledged risks from overseas and a weak
start to the year at their March meeting but remained confident enough in the strength of the recovery to continue laying the groundwork for an interest rate hike later this year, the minutes showed.

Japanese exporters were in demand, with Sony Corp rising 1.7 percent, Tokyo Electron Ltd gaining 1.0 percent and TDK Corp 1.0 percent.

Nissan Motor Co soared 2.5 percent after SMBC Nikko Securities hiked its rating to 'outperform' from 'neutral'
citing likely strong sales.

FamilyMart Co jumped as much as 5.7 pct after the convenience store operator said it expects an operating profit of 46.90 billion yen, a 16.0 pct rise, during the year that ends in February 2016.

Bucking the strength, real estate company Hulic Co dropped as much as 5.0 percent on dilution fears after saying it will raise as much as 82.2 billion yen.

The broader Topix gained 0.4 percent to 1,593.99 and the JPX-Nikkei Index 400 advanced 0.4 percent to 14,506.56.

($1 = 120.3700 yen)

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