Japan Nikkei rises to near five-week high

Japan share market inclined to near five-week high on Monday, 27 August 2018, on tracking a positive note in Wall Street last Friday after the U.S. Federal Reserve Chairman Jerome Powell reaffirmed a slow and gradual pace of policy tightening. Total 32 issues out of 33 TSE index inclined, with shares of Nonferrous Metals, Oil & Coal Products, Electric Appliances, Pulp & Paper, Chemicals, and Machinery issues being notable gainers. Around late afternoon trade, the benchmark Nikkei 225 index rose 0.9%, or 205.55 points, to 22,807.32. The broader Topix index of all First Section issues on the Tokyo Stock Exchange climbed up 1.2%, or 20.28 points, to 1,729.48.

Exporters such as automakers and tech companies led the gains, despite stronger yen. Toyota Motor Corp surged 2%, Honda Motor Co added 1.4%, Tokyo Electron advanced 1.8% and TDK Corp rose 1.9%. Sony was higher by more than 1%, Mitsubishi Electric rose almost 1% and Canon added 0.5%

Defence equipment makers inclined on hopes that geopolitical tension would rise after U.S. President Donald Trump abruptly cancelled his top diplomat's planned trip to North Korea on Friday. Trump partly blamed China for the lack of progress with North Korea and suggested that talks with Pyongyang, led so far by Secretary of State Mike Pompeo, could be on hold until after Washington resolved its bitter trade dispute with Beijing. Ishikawa Seisakusho gained 2.2%, IHI surged 3.3%, Howa Machinery advanced 1.5% and Hosoya Pyro-Engineering Co jumped 6.8%.

CURRENCY NEWS: Japanese yen was little changed against greenback, as demand for safe heaven units continued amid international political tensions after U.S. President Donald Trump abruptly cancelled his top diplomat's planned trip to North Korea on Friday. Around afternoon, the dollar was quoted at 111.28-29 yen compared with 111.19-29 yen in New York and 111.39-41 yen on Friday in Tokyo. The euro, meanwhile, fetched 129.59-63 yen against 129.25-35 yen in New York and 128.72-76 yen in late Friday afternoon trade in Tokyo.

OFFSHORE MARKET NEWS, US stock market closed higher on Friday, following remarks by Federal Reserve Chairman Jerome Powell at the Kansas City Fed's economic policy symposium in Jackson Hole, Wyoming. Powell reiterated the Fed's stance that further gradual increases in interest rates will likely be appropriate if the strong growth in income and jobs continues. The Dow Jones Industrial Average rose 133.37 points or 0.5% to 25,790.35, the Nasdaq advanced 67.52 points or 0.9% to 7,945.98 and the S&P 500 climbed 17.71 points or 0.6% to 2,874.69.

The major European stock markets ended higher on Friday. The French CAC 40 Index, the German DAX Index and the U.K.'s FTSE 100 Index all rose by 0.2%.

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