Nikkei closes at near 1-month high above 10,000 line

09:20, June 17, 2010      

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Japan's Nikkei stock average rose sharply Wednesday to close above 10,000 for the first time in almost a month as a strong performance on Wall Street, coupled with easing debt fears in the eurozone, lifted investors' optimism.

The 225-issue Nikkei Stock Average gained 179.26 points, or 1. 81 percent, from Tuesday to close at 10,067.15, the first time the benchmark has ended above the psychologically important 10,000 level since May 20.

Meanwhile, the broader Topix index of all First Section issues on the Tokyo Stock Exchange advanced 13.55 points, or 1.54 percent, to 892.38, its highest close in nearly one month.

Wall Street's rally overnight helped lift Japanese issues, brokers said, with broad gains being made across the market led by some blue-chip exporters, as concerns about a stronger yen ebbed away as the euro stabilized against the yen and the U.S. dollar.

U.S. stocks soared overnight, with the Dow Jones Industrial Average climbing 2.1 percent to 10,404.77, as worries about the debt crisis in the eurozone eased after successful debt sales in Spain, Ireland and Belgium.

Some 9.2 billion euros (11.34 billion U.S. dollars) were raised in bond sales by Ireland, Spain and Belgium, lifting lingering fears in the region that some countries' sovereign debt situation had become untenable and nudging investors towards taking heavier risks, market players said.

"Market sentiment is improving," said Yumi Nishimura, deputy general manager at Daiwa Securities Capital Markets Co., adding that overnight gains in overseas stocks helped lift Japanese stocks.

"Although there are still negative factors, the euro's fall seems to be taking a respite and when we look at economic indicators, we haven't seen a big impact of the debt problems on the global economy, at least for now," Nishimura said.

The euro stabilized and was traded in the upper 112 yen zone, up from 111 yen range late Tuesday in Tokyo. Europe's single currency also hit a two-week high against the U.S. dollar, increasing investors' appetite towards riskier assets such as stocks.

"The speculative sell-off in response to negative news, which we had seen up until now, might have come to a halt, and short- covering is now picking up momentum," said one Tokyo-based strategist.

Exporters got a boost from a weaker yen as their products become more competitively priced abroad and profits retain their margins when repatriated. Many Japanese exporters have set their currency rate assumptions for euro-yen at between 120 and 125 yen.

Canon Inc., as the world's top digital camera maker with high exposure in Europe and North America, jumped 3.9 percent to 3,880 yen and chip-tester maker Advantest Corp. added 2.5 percent to 2, 028 yen.

Olympus Corp. gained nearly 2 percent to 2,345 yen and Sony Corp. advanced 1.7 percent to 2,658 yen, after the company said it would launch its motion-controlled gaming system months ahead of rival Microsoft.

Regarding other game-related issues Nintendo surged 5.2 percent to 26,520 after unveiling its 3DS handheld device that displays games in 3D and do not require the user to wear special glasses.

The handheld device was one of the biggest crowd-pleasers at the annual E3 game conference in Los Angeles yesterday, said a representative for the company.

Wednesday was a good day for Japan's trading houses as commodity prices rose on expectations for increased demand, sending resource-related issues higher.

Mitsubishi Corp., Japan's top trader, climbed 2.3 percent to 1, 931 yen and smaller counterpart Mitsui & Co. jumped 4.4 percent to 1,140 yen.

On Wednesday, some 1.72 billion shares changed hands on the Tokyo exchange's First section, up from Tuesday's volume of 1.54 billion, with advancing issues outnumbering declining ones by 1, 345 to 209.



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