Japan Nikkei bounces back on bargain hunting

The Japan share market advanced on Friday, 22 November 2019, thanks to bargain buying in recently battered stocks amid pending developments in Sino-US trade negotiations and amid a growing scepticism about reports of progress in the talks. However, market gains were slight as investors also looked to a slew of global manufacturing surveys published later in the day for clues on how deeply the US-China trade dispute is hurting the world's economy. Around late afternoon, the 225-issue Nikkei Stock Average advanced 79.95 points, or 0.35%, to 23,118.53, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange added 2.49 points, or 0.15%, at 1,691.87.

Total 24 issues of the 33 industry category of Topix index inclined into positive territory, with Securities & Commodities Futures, Mining, Pulp & Paper, Glass & Ceramics Products, and Oil & Coal Products issues being notable gainers, while Electric Power & Gas, Air Transportation, Real Estate, and Marine Transportation issues were notable losers.

 

Market participants were opted a wait and see mode amid lingering concerns that preliminary trade deal between Washington and Beijing may not be completed this year as negotiators continue to wrestle over differences. Beijing is pressing Washington to agree to broader tariff rollbacks on Chinese goods and the Trump administration counters with heightened demands of its own. Doubts about substantive progress on a partial trade deal with China ahead of a Dec. 15 deadline for the increase of import tariffs on about $160 billion in Chinese imports somewhat undermined sentiment.

The U.S. and China have imposed tariffs on billions of dollars' worth of one another's goods since the start of 2018, battering financial markets and souring business and consumer sentiment.

Investors had earlier factored in the prospect that a partial truce could be agreed at a mid-November summit in Santiago. But that summit was cancelled and the path forward is now unclear.

Adding to the tensions between the world's two biggest economies, both the U.S. Senate and the US House of Representatives on Wednesday passed legislation intended to support protesters in Hong Kong and send a warning to China about human rights. China regards the legislation as interference in its domestic politics.

The Organization for Economic Cooperation and Development on Thursday said the global economy was headed for its weakest growth since the financial crisis, citing the trade fights as a big factor.

Shares of gaming firm Nintendo fell after Morgan Stanley downgraded the stock to equal-weight from overweight.

CURRENCY NEWS: The Japanese yen, often viewed as a safe-haven currency in times of economic uncertainty, appreciated against greenback. The Japanese yen traded at 108.67 per dollar after strengthening from levels above 108.9 seen earlier in the trading week.

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