RTRS: Nikkei touches 3-month high on econ optimism, yen
Japan's Nikkei average touched a three-month intraday high on Friday after more data raising hopes the U.S. economic downturn is moderating, with exporters such as Toyota Motor Corp (7203.T) jumping on a weaker yen.
But the Nikkei trimmed earlier gains as domestic investors locked in profits on a rally in the past three weeks, while active buying by overseas investors helped boost volume and kept the benchmark in positive territory.
Banking shares such as Japan's top lender Mitsubishi UFJ Financial Group (8306.T) gained after U.S. accounting rulemakers bowed to congressional and financial industry pressure on Thursday to allow more flexibility in valuing toxic assets.
Trade was active with 1.5 billion shares trading hands on the Tokyo stock exchange's first section, compared with last week's morning average of 1.1 billion.
"Investors are becoming more optimistic about economies around the world, and that will keep stocks on an upward trend for a while," said Yoshinori Nagano, a senior strategist atDaiwa Asset Management. "But in the short term the market may pause as people believe it is overheated after a rapid and sharp rally."
The benchmark Nikkei .N225 edged up 0.6 percent or 49.94 points to 8,769.72, after hitting a three-month intraday high of 8,884.63 in early trade. The Nikkei has recovered from a 26-year closing low near 7,000 on March 10.
Declining shares outpaced advancing ones by 887 to 660.
The broader Topix climbed 0.9 percent to 833.98.
U.S. factory orders rose in February for the first time in seven months, boosting industrial, technology, consumer discretionary and energy stocks on Wall Street on Thursday.
Hopes for an improving global economy grew after leaders of the G20 also clinched a $1.1 trillion deal on Thursday to combat the worst economic crisis since the Great Depression and said financial rules would be tightened to stop it happening again.
Orders for Japanese stocks placed through 12 foreign securities houses before the start of trade showed overseas investors were net buyers for the third straight day on Friday, also keeping a bullish tone for the Tokyo market.
"Risk appetite among overseas investors is recovering thanks to rising share prices in the U.S. and European markets," said Yutaka Miura, a senior technical analyst at Shinko Securities.
The Nikkei could rise above the 9,000 yen level next week unless the U.S. monthly employment report due later in the day sparks a stock sell-off, hitting overseas investors' sentiment, Miura said.
Investors will be watching the U.S. Labor Department's March jobs data at 8:30 a.m. EDT, especially after data the previous day showing the number of U.S. workers filing new jobless claims at a 26-year high.
