Nikkei steady after strong U.S. jobs data; Chinese data dents sentiment

By Ayai Tomisawa

TOKYO (Reuters) – Japan’s Nikkei share average was steady on Monday morning as the yen weakened against the dollar after strong U.S. jobs data, but gains were limited as weak Chinese trade numbers capped risk appetites.

The Nikkei gained 0.2 percent to 17,679.24 in mid-morning trade after rising as high as 17,799.49, the highest since Jan. 30.

U.S. jobs data released on Friday showed a rebound in wages while nonfarm payrolls increased more than expected in January. [ID:nL1N0VE2EA]

Shares in the U.S. fell as the better-than-expected jobs report raised expectations the U.S. Federal Reserve will hike interest rates by mid-year.

Analysts said that while some investors took heart from the weakening yen after the U.S. data, others are concerned that liquidity may shrink in the global market if the Fed increases rates too soon.

“A U.S. rate hike is positive for the Japanese market only when rates are gradually rising,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

“The U.S. is trying to increase rates sooner than expected while central banks around the world are easing monetary policy… there are concerns that it may create volatility in the global market,” he said.

Chinese January trade data which was published on Sunday dented sentiment and limited gains. It showed China’s trade performance slumped in January, with exports falling 3.3 percent from year-ago levels while imports tumbled 19.9 percent. [ID:nL4N0VI057]

Exporters were strong after the dollar scaled a one-month high of 119.23 yen on Friday. During Asian trade, it was at 118.85 yen.

Honda Motor Co rose 0.9 percent and Nissan Motor Co gained 1.1 percent.

Nippon Telegraph & Telephone Corp jumped 4.3 percent to 7,174 yen, the highest since December 2001 despite dismal earnings by its mobile business unit NTT Docomo Inc. [ID:nXB1Y1LAOZ]

SMBC Nikko Securities wrote in a report that NTT Docomo’s bad result is seen bottoming out soon.

The broader Topix added 0.3 percent to 1,421.37, and the JPX-Nikkei Index 400 gained 0.3 percent to 12,884.64.

(Editing by Richard Borsuk)