Japan's Nikkei closes at 20-month-high, spurred by chipmakers' investment plans
JAPAN’S Nikkei share average rallied for a sixth straight session to scale a 20-month high on Thursday (May 18), as investors cheered chipmaking investment plans and reasonable April trade data.
The gains are the second such winning streak for the Nikkei in as many months as stocks surf a wave of buybacks and enthusiasm about governance reform. It has climbed nearly 17 per cent this year, far outshining world stocks’ 8 per cent rise.
The Nikkei jumped 1.6 per cent to close at 30,573.93, also posting its biggest daily gain since March 22.
The broader Topix jumped 1.14 per cent to 2,157.85, a 33-year high.
Japan’s exports rose 2.6 per cent in April from a year earlier, Ministry of Finance data showed – a little below expectations.
“Although exports have slowed from the previous month, this result was still relatively good compared with other Northeast Asian countries,” analysts at ING said in a note to clients.
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“The April trade results further support our view that the Japanese economy will stay on a recovery path.”
Japanese Prime Minister Fumio Kishida also said he expected chipmakers to invest in Japan after a meeting with industry executives, while Micron said it plans to spend up to US$3.7 billion to bring the latest ultraviolet chipmaking technology to Japan.
Chipmaking-equipment maker Tokyo Electron rose 5.45 per cent and chip-testing equipment maker Advantest jumped 7.99 per cent, providing the biggest boost to the Nikkei.
Among other winners was Sony Group Corp, which jumped 6.4 per cent to a 16-month high as it examines a partial spin-off of its financial division.
Power companies were among the top losers, extending falls from Wednesday as they grappled with high fuel prices squeezing profit margins.
Japan’s government on Tuesday approved electricity price rises but had taken months to do so.
Tokyo Electric Power fell about 4.75 per cent and Kansai Electric Power lost 2.81 per cent. REUTERS
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