TOKYO: Japanese stocks gained nearly 2 per cent on Tuesday, with exporters such as Canon Inc in favour due to a softer yen while banks gained after their US counterparts rose on hopes for another rate cut by the Federal Reserve. Shares of Victor Co of Japan (JVC) and Funai Electric Co Ltd jumped after an industry source said the consumer electronics makers plan to form an alliance to jointly develop and supply LCD television sets.
"This is simply a rebound, though a softer yen is helping. The Japanese market has recently been moving entirely in response to external factors," said Masaru Hamasaki, a senior strategist at Toyota Asset Management. "The situation in America is likely to improve, helped by stimulus measures for the economy. Even so, Japanese stocks are unlikely advance on their own due to a cool investor attitude toward the market."
A Fed policy meeting ends on Wednesday, with markets expecting a further 50 basis point rate cut. The US central bank slashed its key rate by 0.75 per cent to 3.5 per cent in an emergency step on Jan. 22 after recession fears prompted a plunge in US stocks. The benchmark Nikkei average ended the morning session up 1.8 per cent or 241.16 points at 13,329.07 after shedding 4 per cent on Monday.
The broader TOPIX index added 1.9 per cent or 24.65 points to 1,317.68. The dollar hovered around 107.00 yen after rising to 107.14 yen in earlier trade. All three major US stock indexes gained more than 1 per cent on Monday, with the Dow Jones industrial average ending up 1.45 per cent. Hamasaki also said investors are closely watching President George W. Bush's State of the Union address at 0200 GMT, but they expect few surprises.
"In the long run, Americans can be confident about our economic growth," Bush will say, according to excerpts of his speech released in advance by the White House.
Exporters rebound
Shares of Japanese exporters drove higher as a weaker yen boosts profits when earnings from abroad are brought home. Canon rose 2.8 per cent to 4,750 yen, Sony Corp climbed 2.3 per cent to 4,990 yen and Honda Motor Co Ltd gained 2.6 per cent to 3,220 yen.
Bank shares including industry leader Mitsubishi UFJ Financial Group also climbed, tracking gains in US counterparts that rose after more weak housing data bolstered expectations for a Fed rate cut. Shares of Mitsubishi UFJ shot up 4.9 per cent to 1,033 yen, No.2 bank Mizuho Financial Group rose 3.9 per cent to 508,000 yen and Sumitomo Mitsui Financial Group, the third-biggest, added 3.6 per cent to 828,000 yen.
Shares of JVC jumped 5.3 per cent to 180 yen and Funai Electric rose 5.9 per cent to 4,110 yen. Trade was light on the Tokyo exchange's first section, with 917.2 million shares changing hands, compared with last week's morning average of 1.1 billion. Advancing stocks outnumbered decliners by a ratio of more than four to one.
"This is simply a rebound, though a softer yen is helping. The Japanese market has recently been moving entirely in response to external factors," said Masaru Hamasaki, a senior strategist at Toyota Asset Management. "The situation in America is likely to improve, helped by stimulus measures for the economy. Even so, Japanese stocks are unlikely advance on their own due to a cool investor attitude toward the market."
A Fed policy meeting ends on Wednesday, with markets expecting a further 50 basis point rate cut. The US central bank slashed its key rate by 0.75 per cent to 3.5 per cent in an emergency step on Jan. 22 after recession fears prompted a plunge in US stocks. The benchmark Nikkei average ended the morning session up 1.8 per cent or 241.16 points at 13,329.07 after shedding 4 per cent on Monday.
The broader TOPIX index added 1.9 per cent or 24.65 points to 1,317.68. The dollar hovered around 107.00 yen after rising to 107.14 yen in earlier trade. All three major US stock indexes gained more than 1 per cent on Monday, with the Dow Jones industrial average ending up 1.45 per cent. Hamasaki also said investors are closely watching President George W. Bush's State of the Union address at 0200 GMT, but they expect few surprises.
"In the long run, Americans can be confident about our economic growth," Bush will say, according to excerpts of his speech released in advance by the White House.
Exporters rebound
Shares of Japanese exporters drove higher as a weaker yen boosts profits when earnings from abroad are brought home. Canon rose 2.8 per cent to 4,750 yen, Sony Corp climbed 2.3 per cent to 4,990 yen and Honda Motor Co Ltd gained 2.6 per cent to 3,220 yen.
Bank shares including industry leader Mitsubishi UFJ Financial Group also climbed, tracking gains in US counterparts that rose after more weak housing data bolstered expectations for a Fed rate cut. Shares of Mitsubishi UFJ shot up 4.9 per cent to 1,033 yen, No.2 bank Mizuho Financial Group rose 3.9 per cent to 508,000 yen and Sumitomo Mitsui Financial Group, the third-biggest, added 3.6 per cent to 828,000 yen.
Shares of JVC jumped 5.3 per cent to 180 yen and Funai Electric rose 5.9 per cent to 4,110 yen. Trade was light on the Tokyo exchange's first section, with 917.2 million shares changing hands, compared with last week's morning average of 1.1 billion. Advancing stocks outnumbered decliners by a ratio of more than four to one.
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