Tokyo: Nikkei jumps to more than 2-week closing high after Fed rate hike

[TOKYO] Japan's Nikkei posted its highest close in more than 2 weeks on Thursday (Mar 17), tracking an overnight rally on Wall Street after the Federal Reserve hiked rates as expected, while hopes for a breakthrough in the Russia-Ukraine conflict lifted sentiment.

The Nikkei share average jumped 3.46 per cent to 26,652.89, its highest close since Mar 1. The broader Topix gained 2.47 per cent to 1,899.01.

Main Wall Street stock indexes rose overnight after the Fed hiked interest rates for the first time since 2018 and laid out an aggressive plan for further increases to combat inflation.

"The markets got rid of the negative factors after the Fed's announcement of rate hike," said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.

"In addition to that, we had some more positive cues, including the possibility of a ceasefire in the Russia-Ukraine conflict and the Chinese government's favourable policy for technology stocks."

Moscow and Kyiv held discussions about a status for Ukraine outside of Nato, lifting hopes for a breakthrough after 3 weeks of war.

Ukraine's president, Volodymyr Zelenskiy, said negotiations were becoming "more realistic", while Russian Foreign Minister Sergei Lavrov said proposals now being discussed were "in my view close to an agreement".

Technology investor SoftBank Group jumped 5.89 per cent, following an almost 40 per cent surge in Alibaba, one of its holdings, in US trading after Chinese Vice Premier Liu He said Beijing would roll out support for the economy and keep markets stable.

Other heavyweights also gained, with Uniqlo clothing shop owner Fast Retailing jumping 6.92 per cent and chipmaking equipment maker Tokyo Electron climbing 4.86 per cent.

Japan East Railway fell 1.81 per cent after the railway operator suspended bullet train operations to Fukushima and other regions in the north. The suspension came after a powerful magnitude 7.3 earthquake jolted Japan's north-east coast off Fukushima late on Wednesday.

There were 201 advancers on the Nikkei against 20 decliners. REUTERS