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Tokyo: Stocks open 1.02% higher

Friday, October 31, 2014 - 08:33
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[TOKYO] Tokyo stocks opened 1.02 per cent higher on Friday despite a spate of poor Japanese economic data, as the dollar rose further against the yen on robust US economic data.

The Nikkei 225 index at the Tokyo Stock Exchange rose 158.94 points to 15,817.14 at the start.

Investors also cheered media reports that Japan's national pension fund, the world's largest, decided to double its domestic stock holdings, while they seemed to shrug off poor data from Japan.

A raft of September economic data released early Friday were largely disappointing, including a 5.6 per cent drop in household spending, slower inflation and higher unemployment.

In a plus for Japanese exporters the dollar jumped against the yen Thursday after better-than-expected US economic growth data added to a boost from the Federal Reserve's slightly hawkish policy statement the prior day.

The US Commerce Department said the world's largest economy grew at an annualised 3.5 per cent in the third quarter on stronger exports and defence spending, beating a market prediction of a 3.0 per cent rise.

The reading fuelled speculation that the Fed could hike interest rates earlier than expected.

The dollar was at 109.32 yen early Friday, up from 109.22 yen in New York Thursday afternoon and 109.08 yen in Tokyo earlier Thursday.

A weak yen is good for Japanese exporters as it makes them more competitive abroad and inflates their profit when repatriated.

In New York on Thursday, strong earnings by credit card giant Visa sent its stock soaring by more than 10 per cent, almost single-handedly powering the blue-chip Dow index to a 1.3 per cent gain.

The Dow Jones Industrial Average finished up 1.30 per cent while the broad-based S&P 500 added 0.62 per cent.

AFP