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Japan Market gains on hopes of easing coronavirus restrictions

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Japan share market finished session higher on Monday, 18 May 2020, on the back of Wall Street's lead late last week. Meanwhile, buying was also spirited on optimism that Japan would soon ease restrictions in additional prefectures after signs of a slowdown in coronavirus infections. However, market gains capped on escalating Sino-U. S. trade tensions and after official data showed Japan's economy slipped into recession for the first time in 4-1/2 years in the last quarter. At closing bell, the 225-issue Nikkei Stock Average added 96.26 points, or 0.48%, to 20,133.73. The broader Topix index of all First Section issues on the Tokyo Stock Exchange rose 5.52 points, or 0.38%, at 1,459.29.

Total 22 issues of 33 industry category of Topix index ended in positive territory, with Mining, Fishery, Agriculture & Forestry, Real Estate, Information & Communication, Foods, and Construction issues being notable gainers, while Iron & Steel, Air Transportation, and Electric Appliances issues were notable losers.

The daily number of new coronavirus cases reported in Tokyo on Sunday dropped to five, the lowest since the capital was placed under a state of emergency on April 7.

Meanwhile, the Osaka Prefecture recorded no new coronavirus infections Sunday, in the first such day no cases were reported in more than two months. Japan lifted a state of emergency in large parts of the country on Thursday but said it would remain in place in Tokyo until the novel coronavirus was contained.

However, market gains capped amidst increasing tensions between the United States and China, the world's two largest economies, after the Trump administration on Friday moved to block global chip supplies to blacklisted telecoms equipment giant Huawei Technologies.

The world's third-largest economy contracted an annualised 3.4% in the first quarter, preliminary official gross domestic product (GDP) data showed. The slump came on top of an even steeper 7.3% fall in the October-December period, with the consecutive quarters of contraction meeting the technical definition of a recession. Japan last suffered recession in the second half of 2015.

The coronavirus, which first emerged in China late last year, has ravaged the global economy as many nations went into strict lockdowns to curb the outbreak that has so far killed over 310,000 people worldwide. The pandemic has been massively disruptive on supply chains and businesses, particularly in trade-reliant nations such as Japan.

CURRENCY: The U. S. dollar index, which tracks the greenback against a basket of its peers, was last at 100.31 after seeing highs around 100.5 last week. The Japanese yen traded at 107.11 per dollar after strengthening from levels above 107.6 seen early last week.

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

First Published: Mon, May 18 2020. 11:56 IST