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Tokyo: Stocks open higher after US, European markets stabilise
[TOKYO] Tokyo stocks opened slightly higher on Wednesday, bouncing from a two-day drop after major financial markets in the US and Europe stabilised.
On Wall Street, the Dow Jones Industrial Average and the broader S&P 500 finished Tuesday’s session with modest gains, after Beijing pumped cash into the money market to soothe worries over the slower pace of growth hitting China’s economy.
The Dow ticked up 0.06 per cent and the S&P 500 gained 0.20 per cent. However, the tech-rich Nasdaq Index ended down 0.24 per cent. Markets in London, Frankfurt and Paris also rose.
The advance was a reversal from Monday’s bruising open to the 2016 trading year, when a deep decline of around seven percent in Chinese equities prompted a global stock sell-off.
But analysts said Beijing’s reported 130 billion yuan (S$28.5 billion) intervention in capital markets following the stock plunge helped calm global financial markets.
“(Developments in China) have already been processed by investors,” Chihiro Ohta, general manger of investment information at SMBC Nikko Securities, told Bloomberg News.
“They’re now beginning to look for the next catalyst.” But, “market movements today may not provide enough clues to the bigger trend,” Mr Ohta added.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange rose 0.20 per cent, or 36.57 points, to 18,410.57 in opening deals, while the broad-based Topix index of all first-section shares gained 0.27 percent, or 4.07 points, to 1,508.78.
In currency trading, the dollar ticked up to 119.12 yen from 119.06 yen Tuesday in New York. The euro edged down to US$1.0744 and 127.99 yen from US$1.0750 and 128.00 yen in US trade.