Japan Nikkei gains on bargain hunting

Headline indices of the Japan share market were marginal higher on Monday, 12 November 2018, as investors chased for bottom fishing in oversold equities. However, market gains were meagre amid lingering worries over global economic growth. Total 18 issues of the TSE33 issues inclined, while remaining 15 issues declined, with shares in Machinery, Foods, Textiles & Apparels, Pharmaceutical, Fishery, Agriculture & Forestry, and Real Estate issues being notable gainers, while Nonferrous Metals, Oil & Coal Products, Marine Transportation, and Banks issues were notable losers. In late afternoon trades, the 225-issue Nikkei index inclined 6.72 points, or 0.03%, at 22,256.97. The broader Topix index of all First Section issues on the Tokyo Stock Exchange edged down 0.55 point, or 0.03%, to 1,672.43.

Shares of China-related companies were lower as data from China showing factory-gate inflation slowed for the fourth month in October on cooling domestic demand and manufacturing activity. Construction machinery giant Komatsu was off 0.64% at 3,083 yen and industrial robot maker Fanuc was down 0.48% at 19,485 yen. Electronic parts maker Rohm was down 1.57% at 8,110 yen.

CURRENCY NEWS: Japanese yen was little changed against greenback on Monday. The greenback has also benefited from a safe haven bid as market participants moved away from riskier assets due to US-Sino trade tensions, an economic slowdown in China, Brexit uncertainty, and the standoff between Rome and the European Union over Italy's plan for a big-spending budget and wide fiscal deficit. While the Fed is on track to raise interest rates, the BOJ is expected to keep its monetary policy ultra-loose in the face of slow growth and inflation. The widening interest rate differential between US and Japanese bonds has made the dollar a more attractive bet than the yen, which is often a funding currency for carry trades. The dollar was trading at 113.86 yen in Asian trade, against 113.79 yen in New York late Friday.

OFFSHORE MARKET NEWS: US stocks closed in negative territory on Friday, reflecting renewed concerns about the outlook for interest rates on the heels of the Federal Reserve's monetary policy announcement on Thursday. Adding to the concerns about interest rates, the Labor Department released a report showing a much bigger than expected increase in producer prices in the month of October. The Dow Jones Industrial Average fell 201.92 points, or 0.77%, to 25,989.3, the S&P 500 lost 25.82 points, or 0.92%, to 2,781.01 and the Nasdaq Composite dropped 123.98 points, or 1.65%, to 7,406.90.

European shares dipped on Friday as mining and oil stocks sold off. The French CAC 40 Index and the U.K.'s FTSE 100 Index both fell by 0.5%, while the German DAX Index bucked the downtrend and closed just above the unchanged line.

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