Tokyo: Stocks open up 0.53%

[TOKYO] Tokyo stocks opened 0.53 per cent higher on Monday, supported by a weaker yen and fresh record highs on Wall Street driven by optimism over the outlook for the US economy.

The Nikkei 225 index at the Tokyo Stock Exchange rose 93.87 points to 17,912.83 in the first minutes of trading.

"The market is benefiting from solid year-end momentum as the dollar continues to look bullish, while US data are increasingly pointing to an ideal, moderately recovering economy with no near-term interest rate increase in sight," said SMBC Nikko Securities general manager of equities Hiroichi Nishi.

"The market does look somewhat overheated, but investors are looking forward to next year and are encouraged by the prospects for better-than-expected Japan corporate earnings, and the fact that US shares usually rise in the January before presidential elections." The dollar was at 120.43 yen early Monday, compared with 120.37 in New York Friday, while the euro bought US$1.2168 and 146.54 yen, against US$1.2179 and 146.59 yen.

A weak yen is a positive for Japanese exporters as it makes them more competitive abroad and inflates their repatriated profits.

On Friday, Wall Street stocks rose to fresh records, as investors savoured an outstanding US GDP report released earlier this week.

The Dow Jones Industrial Average, notching its seventh straight gain, advanced 0.13 per cent to 18,053.71, a new all-time high, while the broad-based S&P 500 jumped 0.33 per cent to 2,088.77, also a record.

AFP