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Japan Market extends gain on re-opening optimism

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Japan share market finished higher for second straight session on Tuesday, 26 May 2020, as investors took heart on hopes for increasing domestic economic activity after the government completely lifted the state of emergency and end coronavirus-induced restrictions nationwide a day earlier. At closing bell, the 225-issue Nikkei Stock Average surged 529.52 points, or 2.55%, to 21,271.17. The broader Topix index of all First Section issues on the Tokyo Stock Exchange rose 32.53 points, or 2.17%, at 1,534.73.

All 33 issues of 33 industry category of Topix index advanced, with Air Transportation, Marine Transportation, Transportation Equipment, Real Estate, Land Transportation, Iron & Steel, and Textiles & Apparels issues being notable gainers.

The Tokyo market commenced trading with firm footing after the Prime Minister Shinzo Abe's lifted a coronavirus state of emergency in Tokyo and four other remaining areas yesterday, ending the restrictions nationwide as businesses begin to reopen. The prime minister's announcement came after yesterday's markets closed.

Japan has reported about 820 deaths and more than 16,000 confirmed cases of the new coronavirus, relatively few compared to hard-hit nations like the US.

Air transport was the best performing sector on the main bourse for the second day in a row on hopes for the gradual reopening of the world's third-largest economy, with Japan Airlines Co and ANA Holdings Inc soaring 8.2% and 5.7%, respectively. West Japan Railway Co jumped 8.3% and Central Japan Railway Co advanced 5.2%, also supported by hopes of demand rebound following the reopening.

Isetan Mitsukoshi Holdings climbed 5.1% after the department store operator said it would reopen its main stores in the Tokyo area, including its Isetan flagship in Shinjuku.

ECONOMIC NEWS: BoJ Ready To Take Additional Easing Measures If Required, Says Kuroda - Japan's economy has been in an increasingly severe situation due to the impact of the spread of Covid-19 at home and abroad, Kuroda said in a semi-annual testimony to parliament on Tuesday.

As the impact of the spread wanes, Japan's economy is likely to improve. The annual rate of change in consumer prices is expected to increase gradually, he added. However, the outlook for economic activity and prices is extremely unclear, he said. The central bank will not hesitate to take additional easing measures if required as the novel coronavirus, or Covid-19, depressed global activity, Governor Haruhiko Kuroda said. The BoJ last week introduced a new lending program worth about JPY 30 trillion to help financing small and medium-sized firms struggling to operate.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Tue, May 26 2020. 15:00 IST