OSAKA: Tokyo’s Nikkei 225 has ascended 0.38 per cent following two days of heavy selling that saw the benchmark index dropped above three per cent.
The Nikkei at the Tokyo Stock Exchange added 64.41 points to finish at 16,819.73 on Wednesday, while the Topix index of all first-section shares slipped 0.10 per cent, or 1.36 points, to 1,352.02.
“The Nikkei is rebounding for the first time in three sessions. Bargain hunting is driving up the market, but investors are still wary,” Daiwa Securities said in a note.
The Japanese market initially fell in early trade after the yen strengthened, with investors fleeing to safer assets amid Russia’s rouble crisis.
The yen is seen as a secure investment target in times of economic uncertainty, but the stronger currency hits Japanese exporters as it makes their products less competitive abroad and erodes the value of repatriated income.
The yen gained ground on both the US dollar and the euro on Tuesday, as the Russian central bank’s sharp rate hike to beat back capital flight only partly stemmed the rouble’s fall.
While investors remained cautious over possible risks, they stayed bullish about Japanese shares going forward, said Makoto Sengoku, strategist at Tokai Tokyo Securities.
“Falls of Tokyo shares had been rather rapid,” and encouraged a natural rebound, Sengoku said.
“My view is that the Nikkei could go a step higher toward the year-end,” he said.
Investors were also waiting for the outcome of the Federal Reserve’s monetary policy meeting to be wrapped up on Wednesday.
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