Tokyo stocks open higher on US rebound

TOKYO stocks opened higher on Wednesday as investors took heart from a strong bounce back on Wall Street following last week’s rout over inflation fears.

The benchmark Nikkei 225 index was up 0.67 percent, or 175.54 points, at 26,421.85 in early trade, while the broader Topix index was up 0.70 percent, or 13.07 points, at 1,869.27.

Japanese shares are starting with gains with support from US stocks gains, “but a wait-and-see attitude will likely emerge ahead of US Federal Reserve Chairman (Jerome) Powell’s testimony before Congress” later in the day, senior market analyst Toshiyuki Kanayama of Monex said in a note.

Wall Street stocks bounced overnight, starting a holiday-shortened week on a positive note as investors debated whether the rally could signify a market comeback.

After bruising losses last week, the Dow Jones Industrial Average finished up 2.2 percent at 30,530.25.

The broad-based S&P 500 jumped 2.5 percent and the tech-rich Nasdaq Composite Index won 2.5 percent.

Analysts described the market as primed for a rally after heavy losses for most of 2022 that have left stocks “oversold” on a short-term basis.

The dollar fetched 136.30 yen in early Asian trade, against 136.64 yen in New York late Tuesday when the yen hit a new 24-year low against the greenback.

The Japanese currency fell to the 136 level in London trading in anticipation of wider interest rate gaps between the two countries, even as the dollar eased against other major peers ahead of the Fed chair’s congressional testimony.

Japan’s central bank has bucked the trend set by global peers in sticking with its ultra-easy monetary policy, arguing current inflationary trends are only temporary.

Among major shares in Tokyo, Toyota rallied 1.61 percent to 2,173 yen, Panasonic was up 0.99 percent at 1,122.5 yen, industrial robot maker Fanuc was up 0.91 percent at 21,125 yen and construction machine maker Komatsu was up 0.84 percent at 3,103 yen. — AFP