Tokyo stocks close up on cheap yen

25 May, 2017 12:00 AM printer

Tokyo stocks rose Wednesday as a cheaper yen boosted hopes for Japan Inc's profits.


The benchmark Nikkei 225 index advanced 0.66 percent, or 129.70 points, to end the day at 19,742.98. The Topix index of all first-section shares gained 0.63 percent, or 9.89 points, to finish at 1,575.11, reports AFP.


Toshiba's volatile shares soared nearly 12 percent before ending the session 8.35 percent higher at 251.5 yen.


The stock jumped on a Nikkei business daily report that the troubled conglomerate -- mired in losses at its US nuclear unit -- was holding a meeting with US partner Western Digital over the sale of its prized memory chip business.


The two firms, which jointly operate a chip plant in Japan, have clashed over Toshiba's plans to sell the division, seen as key to its survival.


The dollar was changing hands at 111.92 yen, higher than 111.82 yen in New York and well up from levels below 111 yen in Asia earlier Tuesday.


A cheaper yen is positive for shares of Japanese exporters as it inflates the value of their repatriated profits.


"The yen is trading at levels that make people feel comfortable, a plus for local corporate earnings," Mitsushige Akino, an executive officer at Ichiyoshi Investment Management, told Bloomberg News.


Investors appeared to shrug off news that Moody's cut its credit rating on China -- a major trading partner of Japan -- over concerns about its growing debt mountain.


Tokyo's rise followed a fourth straight winning session for Wall Street, as US President Donald Trump's administration released a 2018 budget that seeks huge cuts over 10 years to a category of spending that includes key social and "mandatory" programmes for lower-income Americans.


Investors will be keeping an eye on the release of minutes from the US central bank's May meeting, hoping for clues about future interest rate rises.


"Investors may want to refrain from going after fresh highs before seeing the minutes," said Toshiyuki Kanayama, a senior market analyst at Monex Inc.


Some major exporter shares rose, with Sony closing up 1.03 percent at 3,998 yen and Honda Motor gaining 2.15 percent to end at 3,135 yen.


Megabank MUFG rose 1.40 percent to 701 yen while game giant Nintendo rose 3.23 percent to 31,880 yen.