Nikkei up to 5-month high in morning on brighter view of U.S. economy
(Japan Economic Newswire Via Acquire Media NewsEdge) The Nikkei stock index rose to a nearly five-month high Thursday morning as a wide range of issues were bought on speculation that U.S. monetary easing will continue for some time.
The 225-issue Nikkei Stock Average climbed 244.43 points, or 1.62 percent, from Wednesday to 15,360.23, the highest since late January on an intraday basis. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 19.06 points, or 1.53 percent, at 1,268.21.
Export-oriented shares like Toyota Motor and Sony gained ground, while major banking groups like Sumitomo Mitsui Financial Group also ended the morning higher after U.S. stocks extended gains for the fourth straight session overnight.
The U.S. Federal Reserve decided Wednesday to scale back its stimulus spending by another $10 billion in July as widely expected by the market, but stopped short of giving any new sign of the timing of a rate hike after a policy-setting meeting of the Federal Open Market Committee.
As for the economic outlook, the Fed revised down its economic growth projection for the current year, while leaving unchanged its growth outlook for 2015. It upgraded its current assessment of the economy, saying, "Growth in economic activity has rebounded in recent months."
It also said labor market indicators "generally showed further improvement."
In contrary to earlier speculation by some market participants that the Fed may present a hawkish view on an interest rate hike, Fed chief Janet Yellen did not specify the timing of a rate hike, stirring speculation that its monetary easing policy will remain in place for a while, brokers said.
"The outcome of the FOMC meeting gave an impression that U.S. accommodative monetary policy will continue for a long time, while the U.S. economy keeps improving," said Hiroichi Nishi, assistant general manager of equity research at SMBC Nikko Securities Inc.
Such views reinforced expectations that funds will continue to flow into equities markets, Nishi added.
All sectors ended the morning higher, with mining, iron and steel, and glass and ceramics products among major gainers.
Toyota, the most heavily traded issue in value terms, rose 173 yen, or 2.9 percent, to 6,057 yen, while Sony advanced 72 yen, or 4.4 percent, to 1,716 yen.
On the First Section, advancing issues outnumbered declining ones 1,300 to 361, while 153 finished the morning unchanged.
Electronics maker Sharp surged 17 yen, or 5.4 percent, to 331 yen after saying Wednesday it has developed a Free-Form Display that can be shaped into a variety of forms, aiming to commercialize the new display for automobile speedometers and other products in fiscal 2017.
(c) 2014 Kyodo News
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