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Tokyo: Stocks gain on bargain-hunting

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[TOKYO] Tokyo stocks gained slightly on Monday as investors bought on dips following a sharp decline late last week, while their focus shifted ahead of a US Federal Reserve meeting.

The benchmark Nikkei 225 index, which dropped more than two per cent on Friday, rose 0.62 per cent or 132.05 points to close at 21,506.88, while the broader Topix index was up 0.13 per cent or 2.04 points at 1,594.20.

"Buy-back was seen among shares in major companies following a sharp decline on Friday," Daiwa Securities senior technical analyst Hikaru Sato told AFP.

"But the buy-back was not strong enough to boost shares further," Mr Sato said, adding that it may take more time to improve market sentiment.

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Takashi Hiroki, chief strategist at Monex, said the two-day US Fed meeting that ends on Wednesday is "the most important event this week" and investors are watching for the pace of rate hikes in 2019.

"Falls in US shares (last week) are said to be caused by weak economic data in China and Europe, but these are not new factors," he said in a commentary, adding that current market sentiment is vulnerable to "even the slightest worries given the prevailing uncertainty".

In Tokyo, SoftBank's initial public offering on Wednesday will also likely have an impact on the market, analysts said.

The dollar fetched 113.51 yen in Asian afternoon trade against 113.29 yen in New York late Friday.

Banks were higher, with Mitsubishi UFJ trading up 0.13 per cent to 583.9 yen, Sumitomo Mitsui Financial up 0.56 per cent at 3,939 yen and Mizuho Financial up 0.22 per cent at 179.7 yen.

Nissan was down 0.27 per cent at 929.9 yen ahead of its board meeting to discuss corporate governance and choosing a replacement for former chairman Carlos Ghosn, after his arrest and dismissal.

Rival Toyota was up 0.16 per cent at 6,840 yen but Honda was down 0.13 per cent at 3,050 yen.

AFP