Japan Nikkei surges on stronger government hopes

Japan stock market finished higher for the fifth straight session on Friday, 03 September 2021, as investors risk sentiments remained bullish on tracking positive lead from Wall Street overnight. Also spurring buying sentiments was hopes that fresh government will increase stimulus spending and be more adept in handling the pandemic after Prime Minister Yoshihide Suga plan to not running in the upcoming leadership election.

Prime Minister Yoshihide Suga bowing out of the leadership race for his party paves the way for a new prime minister. Suga has been under fire for his handling of the Covid situation in Japan, which included the hosting of the Tokyo Summer Olympic Games while the city was under a state of emergency.

At closing bell, the 225-issue Nikkei Stock Average advanced 584.60 points, or 2.05%, to 29,128.11. The broader Topix index of all First Section issues on the Tokyo Stock Exchange added 31.88 points, or 1.61%, to 2,015.45.

Trading volume turnover in the 1st section decreased to 1,062 million shares from 1,236 million shares in previous session. Trading value turnover decreased to 2,457.27 billion yen from 2,846.93 billion yen in previous session.

All 33 industry groups advanced on the Topix, with top performing sectors were Iron & Steel (up 4.1%), Electric Appliances (up 2.4%), Securities & Commodities Futures (up 2.3%), Machinery (up 2.2%), Pharmaceutical (up 2.2%), Chemicals (up 2%), and Real Estate (up 2%) sectors.

ECONOMIC NEWS: The services sector in Japan continued to contract in August, and at a faster pace, the latest survey from Jibun Bank showed on Friday with a PMI score of 42.9. That's down from 47.4 in July, and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the composite index fell to 45.5 in August from 48.8 in July.

CURRENCY NEWS: The Japanese yen traded at 110.02 per dollar, still stronger than levels around 110.4 seen against the greenback earlier this week.

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