BUSINESS Tokyo stocks close sharply higher on Fed's corporate debt-buying program

BUSINESS

Tokyo stocks close sharply higher on Fed's corporate debt-buying program

Xinhua

19:53, June 16, 2020

22bfdf61d825452bb487ee7efb6398ce.jpg

File photo

TOKYO, June 16 (Xinhua) -- Tokyo stocks closed sharply higher Tuesday, ending a three-day losing streak, as the U.S. Federal Reserve saying it would start buying corporate bonds to help provide economic relief to virus-hit businesses, lifted investor sentiment.

The 225-issue Nikkei Stock Average gained 1,051.26 points, or 4.88 percent, from Monday to close the day at 22,582.21.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, added 62.67 points, or 4.09 percent, higher to finish at 1,593.45.

Investors were in a risk-on mood from the get-go, local brokers said, as the U.S. Federal Reserve announcing a new corporate debt purchasing program underpinned hopes for the U.S. and broader global economic recovery.

They added that reports that Washington is planning to roll out an almost 1 trillion U.S. dollar infrastructural package to help support the virus-ravaged economy, added to investors' risk appetite.

"A sense of relief over the emergency aid in and outside the country overwhelmed recent concerns about another wave of virus infections," Shingo Ide, chief equity strategist at the NLI Research Institute, was quoted as saying.

Other market analysts said that recent figures showing that coronavirus cases had been rising in Tokyo, surpassing 40 new infections in the capital for two straight days through Monday when 48 cases were recorded, the highest daily increase since May 5, where shrugged off for the time being.

Underlying concerns remained about the government's plans to further ease virus-linked restrictions this week including those pertaining to cross-prefectural movement, they said, however.

Rising tensions on the Korean Peninsular were also put on the back burner, investment strategists said, and cyclical issues, often susceptible to geopolitical issues, were firm amid the broad based rally.

These included chip-linked issues, with Advantest gaining 8.6 percent, while Screen Holdings leapt 8.6 percent.

Exporters also found traction as the yen dipped against the U.S. dollar, which is a boon for firms broadly exposed to overseas markets as their overseas profits are boosted when repatriated from abroad.

As such, automakers advanced, with Toyota Motor accelerating 4.8 percent, while Honda Motor jumped 7.7 percent.

SoftBank Group ended the day 2.8 percent higher, after announcing potential plans to sell its shares in T-Mobile U.S. Inc. to bolster its finances.

By the close of play, all industry categories closed in positive territory, with iron and steel, marine transportation and transportation equipment issues comprising those that gained the most.

Issues that rose trounced those that fell by 2,104 to 48 on the First Section, while 16 ended the day unchanged.

On the main section on Tuesday, 1.554 billion shares changed hands, rising from Monday's volume of 1.363 billion shares.

The turnover on the second trading day of the week came to 2.754 trillion yen (25.648 billion U.S. dollars).

Related Stories

Terms of Service & Privacy Policy

We have updated our privacy policy to comply with the latest laws and regulations. The updated policy explains the mechanism of how we collect and treat your personal data. You can learn more about the rights you have by reading our terms of service. Please read them carefully. By clicking AGREE, you indicate that you have read and agreed to our privacy policies

Agree and continue