Roundup: Japan’s Nikkei ends higher for 4th straight day amid concerns of overheating
TOKYO, Jan. 25– Japan’s benchmark Nikkei stock index extended its rally to a fourth session Wednesday as cyclical stocks outperformed although gains were subdued amid concerns the market may be overheating. Local brokers said it had taken them by surprise that the Nikkei had topped the psychologically important 27,000 line Tuesday and speculated that…
TOKYO, Jan. 25 (Xinhua) — Japan’s benchmark Nikkei stock index extended its rally to a fourth session Wednesday as cyclical stocks outperformed although gains were subdued amid concerns the market may be overheating.
The 225-issue Nikkei Stock Average added 95.82 points, or 0.35 percent, from Tuesday to close the day at 27,395.01.
The broader Topix index, meanwhile, gained 7.77 points, or 0.39 percent, to finish at 1,980.69.
Local brokers said it had taken them by surprise that the Nikkei had topped the psychologically important 27,000 line Tuesday and speculated that buying could become more subdued looking ahead amid concerns the market could be overheating.
“To be honest, I hadn’t expected the Nikkei to top 27,000 yesterday. These last three days, the Nikkei has risen quite a lot, so there is a feeling it might be a bit overheated,” Kazuo Kamitani, an equity strategist at Nomura Securities, was quoted as saying.
Other analysts said that buying gained some support in later trade owing to the yen’s decline versus the U.S. dollar, but noted the market’s upside was weighed down by investors wanting to book profits.
They added that some investors hit the sidelines ahead of the release of a slew of corporate earnings reports this week, as well as key U.S. personal expenditure data, which could factor into the future course of the U.S. Federal Reserve’s monetary policy.
“The market reacted to the yen’s slight fall in the afternoon. Otherwise, it looks like investors took a wait-and-see stance ahead of the release of key economic indicators later this week,” Shingo Ide, chief equity strategist at the NLI Research Institute, was quoted as saying.
By the close of play, iron and steel shares, marine transportation and precision instrument issues comprised those that gained the most.
Among steelmakers finding favor, Kobe Steel and JFE Holdings both added 3.0 percent, while Nippon Steel jumped 4.5 percent, following reports of a joint project to be launched between it and Exxon Mobil to store carbon dioxide emissions.
After lowering its profit forecast for the year ending March, electric motor maker Nidec dropped 5.4 percent to become Nikkei’s worst performer.
Semiconductor shares were sold for profits, with chip-making equipment manufacturer Tokyo Electron losing 0.3 percent, while chip-testing-equipment maker Advantest ended 1.1 percent lower.
The turnover on the third trading day of the week came to 2,525.57 billion yen (19.44 billion U.S. dollars). Enditem
