Tokyo: Nikkei gains for third day on China optimism; subdued earnings weigh
Add BT as a preferred source
DeeperDive is a beta AI feature. Refer to full articles for the facts.
JAPAN’S Nikkei stock average ended higher for a third straight session on Tuesday (May 17), as optimism about Covid-19 lockdowns ending in major trade partner China outweighed the drag from some disappointing financial results.
The Nikkei traded mostly sideways in the afternoon session to close 0.42 per cent higher at 26,659.75, after briefly dipping into the negative territory in early trade before rallying with other regional markets after Chinese equities opened higher. Most of those gains, however, fizzled into the midday break.
Energy shares led gains among sub-indexes on the Nikkei, jumping 3.62 per cent after crude oil rallied overnight on expectations for a recovery in Chinese demand.
The broader Topix added 0.19 per cent to 1,866.71.
Sentiment was bolstered as Shanghai achieved the long-awaited milestone of 3 straight days with no new Covid-19 cases outside quarantine zones, which could lead to the beginning of the lifting of restrictions.
Uniqlo store owner Fast Retailing, which has many Chinese outlets, gained 0.67 per cent. Department store operator Isetan Mitsukoshi climbed 5.27 per cent.
Navigate Asia in
a new global order
Get the insights delivered to your inbox.
Oil company Inpex jumped 5.64 per cent, making it the second-biggest mover in percentage terms, after video-game maker Konami, which gained 5.65 per cent.
The Nikkei began a 3-day rally on Friday by surging 2.64 per cent, but this week gains have been less than 0.5 per cent, and Tuesday didn’t see a new intraday high, but more of a consolidation around the 26,500 mark.
“With a lot of uncertainty still lingering around the external environment, it’s difficult to chase stock prices higher,” said a market participant at a domestic securities company.
Of the Nikkei’s 225 component stocks, 124 rose versus 97 that fell, with 4 flat.
The biggest decliner by a long margin was brewer Asahi, which tumbled 10.86 per cent after reporting an 83 per cent drop in quarterly operating profit. Rival Kirin fell 4.25 per cent.
Advertising giant Dentsu Group also sank on disappointing financial results, dropping 6.16 per cent. REUTERS
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
