Tokyo stocks close higher

20th June, 2019 10:58:41 printer

TOKYO: Tokyo stocks closed higher Thursday after modest gains on Wall Street as the US central bank signalled it could soon cut interest rates.

The benchmark Nikkei 225 index gained 0.60 percent, or 128.99 points, to 21,462.86, while the broader Topix index ended up 0.30 percent, or 4.63 points, at 1,559.90, reports AFP.

Hopes for cheaper money lifted stocks as the Federal Reserve vowed to act to keep the US economy growing as uncertainties mount over trade and other geopolitical and economic issues.

Fed chief Jerome Powell said trade frictions and slowing growth worldwide have led many central bankers to feel the case for an interest rate cut has “strengthened” but most still want to see more data before making a move.

“A new round of Fed easing is largely contingent on the outcomes from the upcoming G20 meeting between President Trump and Xi,” National Australia Bank said in a commentary.

US President Donald Trump expects to meet his Chinese counterpart Xi Jinping at the G20 summit in Japan next week.

“For now though, the change in the Fed’s bias has encouraged the market to increase its expectations that a new round of easing is just around the corner,” it said.

The yen rose against the dollar in a negative development for Japanese exporters but mounting hopes for the US-China meeting helped lift the Nikkei, Okasan Online Securities chief strategist Yoshihiro Ito said in note.

In individual stocks trade, technology investor SoftBank Group rose 2.58 percent to 10,515 yen and Uniqlo clothing chain operator Fast Retailing climbed 0.98 percent to 67,500 yen.

Some leading automakers fell on the stronger yen, with Toyota ending down 0.47 percent at 6,740 yen and Honda losing 1.87 percent to 2,771 yen.