Thu, 04 Mar 2021

Tokyo shares bounce back as Japan exits recession

16 Nov 2020, 19:42 GMT+10

Tokyo stocks rose Monday supported by gains on Wall Street with investors digesting Japan's third-quarter GDP figures, which showed an exit from recession.

The benchmark Nikkei 225 index added 2.05%, or 521.06 points, at 25 906.93, while the broader Topix index gained 1.68%, or 28.59 points, to 1 731.81.

Shortly before the opening bell, government figures suggested Japan's economy exited recession in the third quarter, with its GDP growing a better-than-expected 5.0% thanks to a rise in domestic demand and exports - signs of recovery after a record contraction.

The Tokyo bourse was also lifted by overnight gains on Wall Street amid hopes for further economic stimulus in the United States under the new administration.

"In the risk-on atmosphere, the market headed north while riding out profit-taking moves," Okasan Online said in a note.

Investors focused on shares that react sensitively to changes in broad economic conditions, such as steel and shipping, said SMBC Nikko Securities.

"Today's Nikkei average enjoyed a major rebound... Momentum has continued since last week when investors cheered the progress made on the development of vaccines against the coronavirus," SMBC Nikko said.

"Investors actively searched for bargain stocks," the brokerage said.

Among major shares, Nissan jumped 5.44% to ¥469, following a media report that the firm has started reviewing its capital relations with Mitsubishi Motors including selling its stake.

Mitsubishi denied the report, while Nissan did not immediate respond.

Japan Airlines soared 5.56% to ¥1 938, while rival ANA Holdings added 3.96% to ¥2 545.5.

Nippon Steel added 3.01% to ¥1 215. Mitsubishi UFJ Financial Group rose 3.48% to ¥461.1.

But Nintendo dropped 1.19% to ¥53 440. Olympus gave up earlier gains and fell 0.97% to ¥2 204.

On Wall Street, the Dow ended up 1.4% to close at 29 479.81.

Source: News24

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