Tokyo stocks soar more than 5%, extending global rally
Tokyo stocks extended a global equities rally on Wednesday morning, with the benchmark index soaring more than 5.0% on the back of a jump on Wall Street and on volatile Chinese bourses.business Updated: Sep 09, 2015 13:07 IST
Tokyo stocks extended a global equities rally on Wednesday morning, with the benchmark index soaring more than 5.0% on the back of a jump on Wall Street and on volatile Chinese bourses.
The Nikkei-225 at Tokyo Stock Exchange skyrocketed 5.05%, or 880.27 points, to 18,307.35, while the broader Topix index of all first-section shares jumped 4.11%, or 58.17 points, to 1,475.28.
The strong rally came after the Nikkei tumbled 2.43% on Tuesday, wiping out all of its gains since the start of the year, as weak China trade data fuelled fears about the world's number two economy.
Chinese figures showed imports and exports sank in August, adding to concerns about the economic giant.
Fears of a slowdown in Chinese growth have sent panic through world stock exchanges, as the country is a key driver of global expansion and a vital market.
But European shares and US stocks powered higher later in the day, after a rally on China's volatile Shanghai Index and an upgrade on the reading for eurozone second-quarter economic growth to 0.4% from 0.3%.
The Dow Jones Industrial Average gained 2.42%, the broad-based S&P 500 jumped 2.51%, while the Nasdaq Composite Index rose 2.73%. And on Wednesday morning, Hong Kong and Shanghai stocks climbed for a second successive day in early trade.
"Expectations for more policy action from China and strength in the European economy saw the return of risk," said Chihiro Ohta, general manager at SMBC Nikko Securities.
"At long last, we may be seeing a real rebound."
A stronger dollar-yen rate, a plus for Japanese exporters, helped lift the Tokyo market with the greenback at 120.28 yen, compared with 119.82 yen in New York.
The euro was mixed at $1.1193 and 134.64 yen, compared with $1.1202 and 134.22 yen in Tokyo.
"As long as China is stable and equity markets there aren't in free fall, markets will generally go higher," Chris Weston, chief markets strategist in Melbourne, told Bloomberg News.
"We won't rule out more volatility ahead of the US meeting next week," the analyst added, referring to the Fed's gathering on September 16-17.
A disappointing US jobs report Friday clouded the outlook for an interest rate hike by the central bank, as investors keep a close eye on what would be the first US rate rise in more than nine years.