Nikkei ends higher for third day on buying on dips


The benchmark Nikkei average managed to extend its winning streak to a third session on the Tokyo Stock Exchange Wednesday, aided by buying on dips.

The 225-issue Nikkei average rose 13.61 points, or 0.07 percent, to finish at 18,432.20. On Tuesday, the key market gauge climbed 63.33 points.

On the other hand, the Topix index of all first-section issues ended down 0.11 point, or 0.01 percent, at 1,471.42, after advancing 5.84 points the previous day.

Stocks opened weaker after European and U.S. equities lost ground on Tuesday as European political situations grew further murky following British Prime Minister Theresa May’s announcement that she will hold a general election on June 8.

The Tokyo market showed some resilience after the initial selling ran its course but turned lower toward the morning close.

Wiping out earlier losses, stocks fluctuated narrowly in positive territory in the latter half of the afternoon session amid buying and selling vying with each other.

“Despite the weakness of U.S. and European shares and the yen’s firming against the dollar, the day’s market was solid,” said Kenichi Hirano, market analyst at K Asset Co.

The market was backed by purchases from investors who thought stock prices had fallen to affordable levels, Hirano said, adding some players were anticipating the Bank of Japan’s purchase of exchange-traded funds.

But in view of European political conditions getting more confused prior to the French presidential election, “investors find it difficult to step up purchases” of Japanese stocks, which showed wild swings each after Britain’s vote to leave the European Union and the election of Donald Trump as president of the United States last year, said Hiroaki Hiwada, strategist at Toyo Securities Co.

An asset management firm official also said that the Nikkei average can hardly top 18,500 and rise further amid escalating tensions with North Korea and concerns over corporate earnings.

Rising issues outnumbered falling ones 1,043 to 820 on the TSE’s first section, while 152 issues were unchanged.

Volume grew to 1.95 billion shares, from Tuesday’s 1.57 billion shares.

Electronics makers Toshiba, Sony and Mitsubishi Electric gained ground together with industrial robot producer Fanuc.

Drug makers Takeda and Eisai and mega-bank groups Mitsubishi UFJ, Mizuho and Sumitomo Mitsui were also buoyant.

Game-related issues, including Nintendo, Gree and DeNA, attracted hefty purchases on rosy earnings prospects.

Other major winners included mobile phone carriers Softbank Group and KDDI and chipmaking equipment maker Tokyo Electron.

By contrast, Yamato Holdings dived 3.49 percent a day after the transportation service group revised down its earnings estimates due to the ¥19 billion payment of overtime it failed to pay in the past two years.

Some export-oriented names, such as automakers Toyota and Honda and electronic parts supplier Murata Manufacturing, met with selling.

In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average closed down 30 points at 18,410.

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