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Tokyo: Stocks close higher after Wall Street gains

[TOKYO] Tokyo stocks closed higher on Monday as traders tracked big gains on Wall Street last week as fears abated over the possibility of accelerated US interest rate hikes.

The benchmark Nikkei 225 index rose 1.19 per cent, or 260.85 points, to 22,153.63 while the broader Topix index was up 0.81 per cent, or 14.28 points, at 1,774.81.

"The markets were calm despite the appreciation of the yen, keeping shares in the high-price range," Okasan Online Securities chief strategist Yoshihiro Ito said in a commentary.

The US dollar fell to 106.52 yen in Asian trade from 106.83 yen in New York and 106.92 yen in Tokyo on Friday.

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All three main indices on Wall Street finished sharply higher on Friday, as the Federal Reserve appeared to tamp down concerns that higher wages would boost inflation.

Stock markets globally plunged earlier in February on worries that the Federal Reserve could accelerate its pace of rate increases.

But Masayuki Kubota, chief strategist at Rakuten Securities, warned in a commentary: "Selling may hit the Nikkei average again this week after the rebound in the New York Dow runs its course."

A key is congressional testimony by new Federal Reserve chief Jerome Powell this week, he said.

"He will probably give no strong remarks, steering clear of a hawkish or dovish tone, but sometimes we see a real intention through innocuous remarks," he said.

Sharp jumped 4.04 per cent to 3,730 yen after a weekend report by the Nikkei business daily that it would set up a joint venture with its parent group, Taiwan's Hon Hai, better known as Foxconn, to produce cameras to be installed in cars.

Sony was up 0.52 per cent at 5,382 yen and SoftBank Group gained 1.73 per cent to 9,050 yen.

AFP