* Nikkei nears its 25-day moving average * Fast Retailing contributes hefty gains after strong 1Q * For the week, Nikkei is down 1.1 pct By Ayai Tomisawa TOKYO, Jan 9 (Reuters) – Japanese stocks extended their gains into a third day on Friday morning after Wall Street rallied on growing confidence in the U.S. economy, while hopes of aggressive stimulus steps in Europe and a pause in sliding oil prices bolstered sentiment.
Adding to the improving mood, index-heavy Fast Retailing Co soared 3.1 percent and contributed a hefty 55 points to the benchmark Nikkei index after reporting strong first quarter profits. Goldman Sachs hiked its target price.
The Nikkei rose 0.5 percent to 17,255.33 at the midday break after touching a high of 17,342,65 earlier, nearing its 25-day moving average of 17,455.41. For the week, however, it is still down 1.1 percent.
Global stock markets suffered sharp losses earlier this week as worries about global growth and falling oil prices dampened risk sentiment. Oil prices enjoyed somewhat of a respite in the past fee days, contributing to the uptick in risk appetite.
Analysts said that some investors are probably beginning to look beyond the negative risks.
“Greece and weak oil prices have been the main worries, but there is nothing new in terms of these risks. Whether it’s the Dow, the S&P, the Nikkei, or even Russian stocks and the rouble have held above their December lows,” said Hiroyuki Nakai, chief strategist at Tokai Tokyo Research Center.
For Japanese stocks, Nakai said that signs of a strong U.S. economy and prospects of more stimulus from the European Central Bank have triggered short-covering. Still, concerted demand may occur only after Japanese companies start reporting their Oct-Dec earnings later this month.
In the U.S., initial claims for state unemployment benefits slipped from the prior week, pointing to a firming labor market ahead of Friday’s key monthly payrolls report.
Exporters were up as the dollar stood at 119.79 yen, extending its recovery from a low of 118.05 hit on Tuesday. Honda Motor Co gained 1.1 percent and Sony Corp added 1.3 percent.
The broader Topix added 0.3 percent to 1,381.25, and the new JPX-Nikkei Index 400 gained 0.2 percent to 12,496.38.
(Editing by Shri Navaratnam)
- Investment & Company Information
- Fast Retailing