Thursday, 27 August 2015 10:48
TOKYO: Tokyo stocks rose 1.89 percent Thursday morning, casting off more China-linked losses following a surge on Wall Street driven by hints the US Federal Reserve would not raise interest rates next month.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange added 347.48 points to 18,724.31 by the break, after a 3.2 percent rally a day earlier ended six days of losses.
The Topix index of all first section shares rose 2.60 percent, or 38.52 points, to 1,517.49.
Tokyo’s gains came as Shanghai surged in morning trade on Thursday and after Wall Street ended a six-day losing streak on fears over China’s economic slowdown.
The Dow added 3.95 percent, the S&P 500 closed up 3.90 percent and the Nasdaq gained 4.24 percent.
That rebound followed comments by William Dudley, the head of the New York branch of the Fed and one of the most influential members of its monetary policy board, who said the case for a long-awaited rate hike in September had weakened.
The argument for adjusting monetary policy next month “seems less compelling to me than just a few weeks ago”, he said Wednesday.
“The consensus now is that a September rate hike probably won’t happen,” Mitsushige Akino, an executive officer at Ichiyoshi Asset Management, told Bloomberg News.
“This means we get to keep the excessive liquidity that’s been supporting markets for a little longer, so there’s a feeling of relief.”
But worries that China, the world’s second-largest economy, could stall world growth still haunted the market even after another rate cut by Beijing.
Widespread concerns remained over whether China is doing enough to calm the markets and sustain economic activity at the current level, despite the injection of hundreds of billions of yuan into markets to support stocks and the currency itself.
In Tokyo, Toyota shares jumped 3.61 percent to 7,170 yen by the break, Sony surged 5.16 percent to 3,116 yen, and banking giant Mitsubishi UFJ climbed 4.00 percent to 800.4 yen.
Mobile carrier SoftBank rose 2.13 percent to 7,017 yen.
On currency markets, the dollar edged up to 120.11 yen from 119.98 yen in New York.
