Nikkei hits another 15-year high on climb in overseas markets

Stocks gained further ground Monday, supported by rises in overseas markets late last week, with the benchmark Nikkei average hitting another 15-year high.

The 225-issue Nikkei average climbed 194.14 points, or 0.99 percent, on the Tokyo Stock Exchange to finish at 19,754.36, its highest closing level since April 14, 2000. On Friday, the key market gauge rose 83.66 points.

The Topix index of all first-section issues added 11.74 points, or 0.74 percent, to end at 1,592.25, after gaining 4.70 points the previous trading day.

The Tokyo market kicked off the week moderately higher after European and U.S. equities advanced Friday. Tokyo stocks quickly accelerated their upswing and maintained strength for the rest of the day.

A wide range of mainstay issues attracted buying as investor appetite was boosted after worries about an early interest rate hike by the U.S. Federal Reserve retreated, sending the Dow Jones industrial average gaining over 160 points, or 0.94 percent, on Friday, brokers said.

In addition, there were active purchases ahead of the final trading day Thursday to secure rights to dividends and other shareholder benefits from firms that close their books this month, brokers noted.

An official at a Japanese securities firm said the Nikkei will likely retake the key 20,000 threshold this week as the market continues to be backed by expectations for an economic recovery and a good supply-demand balance.

On Friday, the Government Pension Investment Fund and three other pension funds announced a common model portfolio for their investments, setting the proportion of domestic and foreign stocks in overall pension assets at 50 percent.

“What I’m worried about is the market’s bullishness,” another securities firm official said. Several technical indicators, including the advance-decline ratio in the TSE’s first section, are suggesting market overheating.

But Nobuyuki Fujimoto, market analyst at SBI Securities Co., said he believes the market will remain solid. “The market is being driven by corporate earnings,” Fujimoto said, adding that “the stocks of companies that have posted brisk earnings are displaying strength.”

Rising issues far outnumbered falling ones 1,228 to 529 in the first section, while 117 issues were unchanged.

Volume fell to 1.8 billion shares from Friday’s 2.1 billion.

Drug maker Takeda Pharmaceutical, automakers Toyota, Fuji Heavy and Honda, electronics maker Toshiba and video game maker Nintendo were buoyant.

Eisai, another drug maker, shot up 20.70 after unveiling test results of its Alzheimer’s disease drug.

Other major winners included Japan Tobacco, oil developer Inpex, clothing chain operator Fast Retailing, leasing firm Orix and retailer Aeon.

On the other hand, industrial robot manufacturer Fanuc, realtors Mitsubishi Estate and Mitsui Fudosan, and online shopping mall operator Rakuten were downbeat.

In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average gained 190 points to end at 19,690.

Nikkei Futures

nikkeifutures.org@imediaone.com

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