Tokyo stocks close higher on US-China trade hopes
Tokyo’s benchmark Nikkei index gained more than one percent Monday on hopes the United States and China will avoid escalating trade frictions, with a cheaper yen also supporting the market.
The Nikkei 225 index added 1.02 percent, or 219.35 points, to close at 21,822.04, while the broader Topix index climbed 0.73 percent, or 11.87 points, at 1,627.59.
Washington and Beijing are close to reaching a major trade deal that would see both sides lower some of the tariffs imposed during an often-bitter trade war, a report said Sunday.
Negotiators for the two sides have made substantial progress and a final accord is close to being hammered out, according to the Wall Street Journal, which quoted anonymous sources on both sides.
“The news should be a positive for risk sentiment at the start of the new week,” Rodrigo Catril, strategist at National Australia Bank, said in a note.
After months of sparring on trade, the US and China agreed in December to a 90-day truce to work out their differences.
It was scheduled to end Friday, but US President Donald Trump eventually lifted the ultimatum to increase tariffs, satisfied by progress made in several rounds of talks in Beijing and Washington.
“The market is still cautious about the fate of the negotiations but the current risk-on sentiment sustained downside support solidly,” said Toshikazu Horiuchi, a broker at IwaiCosmo Securities.
“Also the current levels of the yen are good for Japanese exporters, boosting market sentiment,” Horiuchi told AFP.
The dollar fetched 111.96 yen in Asian afternoon trade, against 111.92 yen in New York and 111.74 yen in Tokyo on Friday.
“Looking ahead, investors will be closely watching comments by US and Chinese senior officials over trade,” including at the National People’s Congress in Beijing starting this week, where ministers and senior central bankers will speak, Tsuyoshi Nomaguchi, strategist at Daiwa Securities, said in a commentary.
In Tokyo, China-linked shares were higher, with electronic parts maker Rohm rallying 2.12 percent to 7,230 yen and industrial robot maker Fanuc trading up 3.48 percent at 19,450 yen.
Sony was up 0.20 percent at 5,326 yen and Panasonic rose 0.34 percent to 1,021.5 yen but Nintendo dropped 1.58 percent to 30,400 yen.
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