Tokyo: Nikkei at more than 1-month highs as yen weakens on Trump relief

[TOKYO] Japan's Nikkei share average probed more than one-month highs on Monday, cheered by Wall Street breaking records, a weaker yen and relief that talks between U.S. President Donald Trump and Japan's Prime Minister Shinzo Abe yielded no negative surprises.

The Nikkei was up 0.5 per cent at 19,483.38 at the end of morning trade, after earlier rising as high as 19,519.44, its highest since Jan 5 "The January high of 19,615.40 is in sight," said Yutaka Miura, a senior technical analyst at Mizuho Securities. "It might not be topped today, but it would not be surprising if it was attained later this week," he said.

Wall Street's main stock indexes rose to fresh all-time closing highs on Friday as a spike in oil prices supported energy shares and investors renewed their optimism about Mr Trump's economic agenda.

On Mr Abe's US visit, Mr Trump abruptly set aside campaign pledges to force Tokyo to pay more for US defence aid as well as his past complaints that Japan was artificially weakening its currency.

The dollar was up 0.7 per cent at 113.95 yen after topping 114 earlier in the session, and pulling away from last week's 10-week lows.

"The mood here is clearly one of relief," said Stefan Worrall, director of Japan equity sales at Credit Suisse in Tokyo. "Going into the summit, the degree of anxious hand-wringing by Japanese policymakers was palpable," he said, as they fretted about whether currencies or the Bank of Japan's monetary easing steps would attract Mr Trump's ire.

Data released earlier on Monday showed Japan's economy grew for a fourth straight quarter in the final three months of last year thanks to strong exports, though weak private consumption and rising protectionism in the United States suggested a sustainable recovery could be some way off.

The broader market shrugged off news that North Korea fired a ballistic missile into the sea off its east coast early on Sunday, the first time the isolated state has tested such a device since Mr Trump's election.

The Tokyo Stock Exchange's mining subindex gained 5.5 per cent, while the oil and coal subindex rose 3.2 per cent.

Crude oil futures rallied on Friday on reports that Opec members delivered more than 90 per cent of the output cuts they pledged in a landmark deal that took effect in January, though they gave back some of those gains on Monday.

Oil producer Inpex Corp jumped 5.9 per cent, scaling its highest levels in more than three weeks, after it forecast higher profits for the fiscal year through March.

But consumer goods maker Lion Corp fell 9.2 per cent after it forecast its 2017 operating profit would rise 10.2 per cent, slowing sharply from 2016's 49.6 per cent increase.

The broader Topix gained 0.6 per cent to 1,556.07, while the JPX-Nikkei Index 400 rose 0.7 per cent to 13,969.05.

REUTERS