Photo: Kazuhiro NOGI / AFP
Source: AFP
Tokyo stocks surged Tuesday following a record selloff the previous day that was fuelled by worries over the US economy and a stronger yen.
The benchmark Nikkei 225 index went into the break 9.40 percent, or 2,957.90 points, higher at 34,416.32, having roared more than 10 percent earlier in the day.
The broader Topix index rose 9.30 percent, or 207.06 points, to 2,434.21.
The Nikkei plunged more than 12 percent Monday, or 4,451.28 points — the largest points drop in its history.
Prime Minister Fumio Kishida said Tuesday it was best to approach the sharp swings with a cool head as analysts predicted that volatility could continue for days.
“The stock market has been moving again today, and I think it is important to judge this situation calmly,” Kishida said at a scheduled news conference.
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“We will continue to monitor the situation with a sense of urgency and to carry out economic and fiscal management in close cooperation with the Bank of Japan,” he said.
Nomura Securities added that the market would likely remain highly volatile this week.
“Today’s gain can be explained in one phrase: a technical rebound” after the sharp fall, the brokerage said.
Monex said it expected nervous trade to continue with a focus on forex movements.
“The market is seen starting sharply higher, as it should perform a natural rebound after yesterday’s plunge while dollar-yen moves towards the yen’s depreciation,” it said.
The yen was also volatile, standing at 144.75 against the dollar in late morning, compared with 146.28 in early trade.
On Monday the Japanese currency had strengthened to 141.70 against the dollar, its strongest since early January.
A stronger yen is a negative for Japanese exporters, and recent rallies were fuelled by central bank policy decisions that reversed months-long trends.
The Bank of Japan last week raised interest rates for the second time in 17 years, with talk of another rate hike to come, while the US Federal Reserve has hinted at a cut as soon as September.
Among major shares in Tokyo on Tuesday, Honda roared 16.58 percent to 1,459 yen following a report that it was expected to announce a record quarterly profit.
Toyota jumped 12.72 percent to 2,516 yen, Sony Group advanced 9.08 percent to 12,310 yen and Nintendo added 13.56 percent to 7,503 yen.
Semiconductor shares were also sharply higher, with Tokyo Electron adding 16.75 percent to 25,750 yen and Advantest up 14.51 percent at 6,084 yen.
Source: AFP
