Japanese stocks hit new seven-year high
Tuesday, 10 July 2007
TOKYO, July 9 (AFP): Japanese share prices closed at a fresh seven-year high, lifted by better-than-expected machinery orders data, a weaker yen and a positive lead from Wall Street, dealers said Monday.
The Tokyo Stock Exchange's benchmark Nikkei-225 index of leading shares climbed 121.04 points or 0.67 percent to 18,261.98. The broader Topix index of all first-section shares added 12.56 points or 0.71 percent to 1,792.23.
Gainers beat decliners 1,125 to 462, with 140 stocks flat. Turnover rose to 1.7 billion shares from 1.68 billion Friday.
"Wall Street's gains (Friday), a softer yen and upbeat machinery orders supported the market," said Hiroichi Nishi, equity chief at Nikko Cordial Securities.
A 5.90 per cent jump in domestic core private-sector machinery orders in May was much better than the 2.60 per cent gain expected by the market, easing concerns about slowing corporate capital spending, dealers said.
"The market responded favourably to the May machinery data and to higher overseas share prices," said Hiroaki Hiwada, a strategist at Toyo Securities.
He said the machinery orders data showed corporate capital spending remains strong and that bodes well for the economy and further stockmarket gains.
Continued softness in the Japanese currency kept investors optimistic about prospects for the upcoming company results season.
"With fiscal first-quarter results coming soon, the softer yen has boosted market expectations that exporters will revise up their earnings estimates (for the full year)," Hiwada said.
Dealers said, however, that shares may struggle to make further headway ahead of a two-day interest rate meeting at the Bank of Japan through Thursday.
While the central bank is not expected to make any move yet on interest rates, players hope for some clues from governor Toshihiko Fukui on the chances of a hike in August.
Sony Corp fell 10 yen or 0.15 per cent to 6,530 after announcing it would cut the price of the PlayStation 3 in North America by almost 17 per cent to try to boost sales in the face of fierce competition with Nintendo and Microsoft.
The Tokyo Stock Exchange's benchmark Nikkei-225 index of leading shares climbed 121.04 points or 0.67 percent to 18,261.98. The broader Topix index of all first-section shares added 12.56 points or 0.71 percent to 1,792.23.
Gainers beat decliners 1,125 to 462, with 140 stocks flat. Turnover rose to 1.7 billion shares from 1.68 billion Friday.
"Wall Street's gains (Friday), a softer yen and upbeat machinery orders supported the market," said Hiroichi Nishi, equity chief at Nikko Cordial Securities.
A 5.90 per cent jump in domestic core private-sector machinery orders in May was much better than the 2.60 per cent gain expected by the market, easing concerns about slowing corporate capital spending, dealers said.
"The market responded favourably to the May machinery data and to higher overseas share prices," said Hiroaki Hiwada, a strategist at Toyo Securities.
He said the machinery orders data showed corporate capital spending remains strong and that bodes well for the economy and further stockmarket gains.
Continued softness in the Japanese currency kept investors optimistic about prospects for the upcoming company results season.
"With fiscal first-quarter results coming soon, the softer yen has boosted market expectations that exporters will revise up their earnings estimates (for the full year)," Hiwada said.
Dealers said, however, that shares may struggle to make further headway ahead of a two-day interest rate meeting at the Bank of Japan through Thursday.
While the central bank is not expected to make any move yet on interest rates, players hope for some clues from governor Toshihiko Fukui on the chances of a hike in August.
Sony Corp fell 10 yen or 0.15 per cent to 6,530 after announcing it would cut the price of the PlayStation 3 in North America by almost 17 per cent to try to boost sales in the face of fierce competition with Nintendo and Microsoft.