Japan’s Nikkei rises on Wall Street profits and gains

Japan’s Nikkei rises on Wall Street profits and gains
Japan’s Nikkei rises on Wall Street profits and gains

Japan’s Nikkei stock average rebounded on Friday, supported by positive earnings and Wall Street’s overnight gains, although profit-taking limited further advances.

The Nikkei was up 0.62% at 38,311.63 at midday, after rising more than 1% earlier in the session.

The broader Topix was up 0.68% at 2731.86.

The benchmark index had a choppy week after hitting a three-week high of 38,863.14 on Tuesday.

Rising expectations for a cut in U.S. interest rates following weaker-than-expected job growth in April improved investor sentiment this week.

Wall Street added further momentum, rising after weekly unemployment data boosted hopes for interest rate cuts.

These, combined with strong local earnings, gave the Nikkei the momentum it needed to try to rise again.

But the rally was dampened by investors rushing to take profits, with the index near the psychologically significant level of 39,000.

“It seems to me that we have entered a period of consolidation,” said Tony Sycamore, market analyst at IG.

“But looking at the bigger picture, a period of consolidation is not a bad thing. It usually means the market is regaining energy.”

The index reached an all-time high of 41,087.75 earlier this year, before retreating last month.

Among individual stocks, earnings reports largely determined winners and losers in the morning session.

Gaming companies stood out, with Konami Group, up 9.3%, leading the gains. Bandai Namco Holdings and Nintendo also rose, by 6.3% and 3.5% respectively.

Electrical equipment maker Daikin Industries jumped 9%.

Screen Holdings, which specializes in electronic chips, lost 10.9%. Shares of Panasonic Holdings fell 5.5% after the company’s energy unit missed its operating profit forecast for the trading year. (Reporting by Brigid Riley; Editing by Rashmi Aich)

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