Japanese Tech Makers Lead Stock Recovery
Japanese stocks rebounded on Monday, with the Topix rising the most since Dec. 27, as optimism about the U.S. economy buoyed sentiment in the technology sector and financials got a boost from expectations the Bank of Japan will raise interest rates this week.
The Topix index rose 1.2% to 2,711.27 at the close in Tokyo
The Nikkei gained 1.2% to 38,902.50
Toyota Motor Corp. contributed the most to the Topix, rising 2.9%. Of the 2,119 stocks in the index, 1,675 rose and 369 fell, while 75 were unchanged.
Electronics makers led the Topix advancers, as technology companies followed their U.S. peers higher after a recent uptrend in U.S. yields lost momentum, fueling expectations the Federal Reserve may cut interest rates sooner rather than later. The yen’s weakness against the dollar also helped export-dependent stocks such as automakers — the Topix auto index rose 2.2 percent, the most among all subindustries. “Japanese stocks were very weak last week, so there was a lot of reactionary buying,” said Yusuke Sakai, a senior trader at T&D Asset Management. Optimism about the U.S. economic outlook, following weaker-than-expected CPI data last week, also helped, he added. Still, investors remained cautious ahead of Donald Trump’s inauguration, Sakai said.
“But many Japanese market players don’t see Trump as a negative for business. I don’t think Japanese investors need to worry too much about his inauguration,” he said.
Banking stocks rose, with Mitsubishi UFJ and Sumitomo Mitsui among the top 10 Topix gainers, boosted by bets that the BOJ will raise interest rates at its meeting later this week. Overnight index swaps showed an 85 percent chance of a rise by Monday’s market close.
Source: Bloomberg
