TOKYO: Tokyo stocks rose Monday morning, tracking gains on Wall Street as the benchmark Japanese index extended a rally after ending at a fresh two-decade high last week, but scandal-hit Kobe Steel slipped further.
The Nikkei 225, which closed at its highest level since November 1996 on Friday, rose 0.63 percent, or 132.94 points, to 21,288.12 by the break, while the broader Topix index was up 0.90 percent, or 15.45 points, at 1,724.07.
“Market sentiment remains solid,” said Toshikazu Horiuchi, a broker at IwaiCosmo Securities.
“We are concerned about overheating, but strong Japanese corporate earnings are holding up the market.”
Kobe Steel hit a five-year intraday low of 774 yen soon after the opening bell, with the stock down by more than 40 percent since the start of last week owing to a fake-data scandal.
It then came off the low somewhat to end the morning session at 804 yen, down 0.12 percent.
The fresh drop came after the steelmaker said Friday that the snowballing scandal had affected around 500 customers, more than twice as many as initially thought.
But hedge funds and other investors are buying the shares on expectations of a rebound, Fumio Matsumoto, a fund manager at Dalton Capital Japan, told Bloomberg News.
But he added that “not all the bad news is exhausted until we know how earnings will be affected”.
The auto sector gained ground, with Toyota up 0.33 percent at 6,920 yen and Nissan climbing 0.36 percent to 1,089 yen.
SoftBank jumped 1.80 percent to 10,035 yen following a report that it had reached an accord to merge its US subsidiary Sprint with T-Mobile to create a rival to America’s top two wireless carriers. A SoftBank spokeswoman declined to comment.
The dollar traded at 112.00 yen against 111.86 yen in New York late Friday.
Source: Brecorder.com
