Tokyo: Shares rise on oil price drop, gains in Chinese stocks

[TOKYO] Japanese shares ended higher for a third straight session on Wednesday (Mar 16), tracking overnight Wall Street gains, as a drop in oil prices lifted risk appetite, while a rise in Chinese stocks underpinned investor sentiment.

The Nikkei share average rose 1.7 per cent to end at 25,762.01, while the broader Topix climbed 1.46 per cent to 1,853.25.

Both the indexes accelerated gains as Chinese equities advanced after its Vice Premier Liu He indicated the nation plans to take measures to boost the economy and would also announce policies favourable to capital markets.

Chipmaking equipment maker Tokyo Electron, up 3.24 per cent, was the top boost to Nikkei, followed by SoftBank Group jumping 5.96 per cent.

The 3 main Wall Street stock indexes rallied overnight, a day before an expected interest rate hike by the US Federal Reserve, while oil prices dropped 7 per cent on hopes of an end to the conflict in Ukraine.

The US central bank is expected to raise rates for the first time in 3 years by at least 25 basis points amid surging prices. Traders will also be closely watching the Fed for details on how it plans to end its bond-buying programme.

"A drop in oil prices eased investor sentiment. And investors hoped that (Federal Reserve Chair) Jerome Powell would indicate a clearer path for the rate increase to remove uncertainties," said Ikuo Mitsui, fund manager at Aizawa Securities.

"But volatilities remain high and the markets are sensitive to any negative cues."

Airlines rose 3.82 per cent, leading gains among Tokyo Stock Exchange's 33 industry sub-indexes, as Japan is set to announce the lifting of Covid-19 restrictions imposed on Tokyo and other prefectures. REUTERS