Nikkei rises on robust earnings

Stocks gained further ground Tuesday, with investors taking heart from a recent spate of robust corporate earnings reports.

The Nikkei 225 average rose 135.18 points, or 0.70 percent, to end at 19,445.70. On Monday, the key market gauge climbed 113.78 points.

The Topix, covering all first-section issues, closed 10.53 points, or 0.68 percent, stronger at 1,550.30 after gaining 7.97 points Monday.

Stocks got off to a firmer start after the tech-heavy Nasdaq composite index posted a record closing high in New York on Monday although the Dow Jones industrial average lost ground.

The Tokyo market accelerated its upswing later on the back of the yen’s weak tone against the dollar and brisk earnings results and estimates released by major Japanese companies since last week.

Japan is set to enter a five-day weekend, but the market was “unexpectedly firm” thanks to active buying by foreign investors who took a risk-on stance, a bank-affiliated securities firm official said. The Tokyo market will be closed Wednesday through Friday for national holidays.

However, the Nikkei average failed to retake the 19,500 line as market players retreated to the sidelines “ahead of key events abroad” during the holiday period in Japan, said Nobuyuki Fujimoto, market analyst at SBI Securities Co.

Among the events are the U.S. Federal Reserve’s two-day Federal Open Market Committee meeting through Wednesday, U.S. jobs data for April on Friday and the French presidential runoff on Sunday, Fujimoto said.

If far-right leader Marine Le Pen, who opposes the European Union, wins the French election, Tokyo stocks would likely plunge, he also said, while noting that the possible victory of centrist Emmanuel Macron, known for his pro-EU stance, “has already been factored into the market.”

Rising issues outnumbered falling ones 1,487 to 436 on the TSE’s first section, while 93 issues were unchanged.

Volume grew to 1.862 billion shares from Monday’s 1.760 billion.

Knitting machine maker Shima Seiki posted a maximum-allowable single-day gain, supported by its stronger-than-expected operating profit forecast for fiscal 2017, announced on Monday.

Musical instrument maker Yamaha and cosmetics maker Pola Orbis Holdings were also buoyant thanks to their brisk operating profit estimates.

Also on the plus side were realtors Mitsui Fudosan, Mitsubishi Estate and Sumitomo Realty, electronics and machinery maker Toshiba, electronic components maker Kyocera, semiconductor-related Sumco and automaker Toyota.

By contrast, JGC plunged 7.20 percent after the engineering firm said Tuesday that its operating loss in the year through last month is seen to have expanded to ¥22 billion from the earlier estimated ¥9.5 billion, brokers said.

Other major losers included Japan Display and drug maker Peptidream.

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