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Japanese shares end higher as robust earnings lift sentiment

The Nikkei share average rose 1% to 28,646.50. (File photo/AP)
The Nikkei share average rose 1% to 28,646.50. (File photo/AP)
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03 Feb 2021 03:02:42 GMT9
03 Feb 2021 03:02:42 GMT9

Japanese shares ended higher on Wednesday, with transport stocks leading gains, as Wall Street’s tech-driven rally overnight and strong domestic earnings forecasts boosted market sentiment.

The Nikkei share average rose 1% to 28,646.50, while the broader Topix jumped 1.3% to 1,871.09.

“Robust earnings of global IT firms have boosted investor expectations for better earnings of Japanese companies, while worries about a short-squeeze triggered by U.S. retail investors had been erased,” said Koichi Kurose, chief strategist at Resona Asset Management.

U.S. stocks finished sharply higher for a second straight day overnight, helped by gains in and Google-parent Alphabet ahead of their results, and by optimism over progress on a U.S. pandemic relief package.

All but one of the 33 sector sub-indexes on the Tokyo exchange traded higher, with pandemic-hit airlines and land transport stocks leading gains.

Japan Airlines jumped 6.56% while ANA Holdings rose 2.9%.

Central Japan Railway, the operator of the bullet trains connecting Tokyo and Osaka, gained 5.47%. West Japan Railway rose 6.86% and East Japan Railway jumped 5.48%.
Transport shares were buoyed by hopes that a drop in the number of daily COVID-19 infections would boost travel, Kurose said.

Japan on Tuesday extended the state of emergency in Tokyo and other regions for another month, seeking to keep the upper hand over a COVID-19 outbreak, although daily case numbers have begun to edge down.

Mitsubishi Motor, up 11.34%, led gains on the Nikkei 225 index after it cut its annual net loss forecast on Tuesday.

Panasonic rose 3.84% after the electronics conglomerate said its battery business supplying Tesla Inc would be profitable this fiscal year, and raised its full-year operating profit forecast by more than half.


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