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Tokyo stocks rebound on brisk corporate earnings

Tokyo stocks rebound on brisk corporate earnings

TOKYO: Tokyo stocks staged a slight rebound Tuesday, supported by brisk corporate earnings. The Nikkei 225 average gained 60.61 points, or 0.30 percent, to end at 19,985.79. On Monday, the key market gauge lost 34.66 points.

The Topix, which covers all first-section issues, closed 9.89 points, or 0.61 percent, higher at 1,628.50 after falling 2.61 points the previous day. The market held firm in early trading, buoyed by robust earnings reports from major companies, brokers said. A wide range of issues attracted purchases, including banks, transportation companies and retailers. But the market’s topside was capped by the yen’s strengthening against the dollar amid uncertainty over the policy management of the administration of U.S. President Donald Trump, brokers said. “It is extremely difficult to analyze today’s market as some issues showed strange movements,” said Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc. As an example, he pointed to gains in automakers and other export-oriented issues despite the yen’s strengthening.

Analysts, however, agree that the market’s condition was favorable as a whole, backed by upbeat corporate earnings. But the tail wind was somewhat hindered by the external environment, including the yen’s ascent due to concern over the U.S. political situation, said Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc. Fujii cited Anthony Scaramucci’s removal as White House communications director on Monday, just 10 days after being named to the post, as a factor that further strengthened cautiousness in the market. “If the external environment improves, the Nikkei average will be ready to take off to higher levels,” backed by corporate earnings, Fujii said. But when that will happen is unpredictable, he added.

Rising issues outnumbered falling ones 1,112 to 813 in the TSE’s first section, while 97 issues were unchanged. Volume fell to 1.944 billion shares from 2.334 billion Monday. Banking issues Sumitomo Mitsui and Sumitomo Mitsui Trust, as well as regional lenders Chiba Bank and Concordia Financial, attracted purchases. Also on the plus side were JAL, Start Today, the operator of the Zozotown online fashion mall, and parcel delivery service firm Yamato Holdings. By contrast, steelmaker Nippon Denko, Kawasaki Heavy and electronic parts producer Murata Manufacturing were downbeat.