Japan Nikkei gains on upbeat offshore lead, weak yen

Headline indices of the Japan share market closed higher on Friday, 17 August 2018, as investors risk appetite buying resumed on news of a new round of U.S.-China trade talks, with the market mood further brightened by a weak yen giving exporters a boost. Total 29 issues out of 33 TSE index inclined, with shares of Marine Transportation, Precision Instruments, Mining, Insurance, Banks, Iron & Steel, Machinery, Nonferrous Metals, and Securities & Commodities Futures issues being notable gainers. At closing bell, the benchmark Nikkei 225 index advanced 0.35%, or 78.34 points, to 22,270.38. The broader Topix index of all First Section issues on the Tokyo Stock Exchange added 0.62%, or 10.38 points, to 1,697.53.

Market participants are awaiting developments in the US-China trade conflict after the two countries said on Thursday they would hold lower-level trade talks next week. As per reports, the talks in Washington would take place on August 21 and 22, just before $16 billion in new US tariffs on Chinese goods take effect, along with an equal amount of retaliatory tariffs from Beijing.

Shares of major exporters advanced on a weaker yen. Sony and Panasonic were adding more than 1%, Mitsubishi Electric is advancing almost 1% and Canon was rising 0.6%. In the auto space, Honda was up 0.6% and Toyota was rising 0.2%.

Cyclical stocks such as shippers, metal firms and financials outperformed. Mitsui OSK Lines surged 2.2%, Sumitomo Metal Mining advanced 2.1% and Mitsubishi UFJ Financial Group rose 1.7%.

Chip-related stocks fell after Applied Materials disappointed investors with worse-than-expected earnings forecasts overnight, with Tokyo Electron falling 1.4% and Screen Holdings down 2.7%.

CURRENCY NEWS: The Japanese yen depreciated to upper 110 yen zone against U.S. dollar on Friday, as demand for safe haven dimmed on news the US and China are planning to hold fresh trade talks in Washington mid next week.

OFFSHORE MARKET NEWS, US stock market closed higher on Thursday, amid upbeat corporate earnings results and news of a new round of U.S.-China trade talks. The Dow Jones Industrial Average advanced 396.32 points or 1.6% to 25,558.73, the Nasdaq rose 32.41 points or 0.4% to 7,806.52 and the S&P 500 climbed 22.32 points or 0.8% to 2,840.69.

The major European markets also closed higher on Thursday. The German DAX Index climbed by 0.6%. The U.K.'s FTSE 100 Index and the French CAC 40 Index both advanced by 0.8%.

Powered by Capital Market - Live News