Nikkei inches up, but Softbank fall weighs

By Staff
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Google Oneindia News

Tokyo, June 1: The Nikkei share average ended 0.24 percent higher on Thursday as rises on Wall Street encouraged investors to buy Tokyo Electron Ltd and other blue-chip shares, but gains were capped due to heavy selling in Softbank Corp Lingering concerns about a slowdown in the U.S. economy weighed on the market and extended losses in small-cap shares also raised concerns about retail investors' appetite for stocks.

''People are closely watching foreign investors' moves and whether individual investors will be able to come back and support the market,'' said Yumi Nishimura, manager in the investment advisory section at Daiwa Securities SMBC Co Ltd.

Takahiko Murai, a general manager of equities at Nozomi Securities, said investors are temporarily shifting funds to bonds and other less risky assets from stocks.

''Speculative money is being pulled away and people are parking their funds in safer instruments than stocks,'' he said.

Data showed on Thursday that foreign investors sold a net 221.7 billion yen of Japanese stocks last week, while they bought a net 1.07 trillion yen (.50 billion) of Japanese bonds.

Murai said risks still remain for the Japanese market.

''The biggest risk is that the U.S. monetary authorities tighten their credit grip too much,'' he said.

Some analysts said caution ahead of U.S. jobs data on Friday is also keeping the market from advancing.

The Nikkei inched up 36.41 points to 15,503.74, snapping a three-session losing streak. On Wednesday, the benchmark average lost 2.47 percent, its biggest one-day percentage fall in five weeks, and hit its lowest close since February.

The broader TOPIX rose 0.29 percent to 1,584.56.

The Mothers market closed down 3.9 percent to 1,317.80, extending its losses into a sixth session Softbank, the most active issue by value, fell for a fifth session and lost 7.7 percent to 2,510 yen.

Moody's Investors Service revised its rating outlook on Japan's domestic debt to positive from stable on Thursday based on an improving economy and fiscal reform efforts, but the move failed to give much of a boost to the market.

Meanwhile, gainers included Tokyo Electron, which rose 2.2 percent to 8,070 yen. Canon Inc, the world's biggest digital camera maker, also gained 1.4 percent to 7,870 yen, after the previous day's 4.2 percent drop.

Mitsubishi Logistics Corp., a warehousing company, jumped 6.8 percent to 1,805 yen on Nikko Citigroup's upgrades, helping the warehousing index become the second-best performing sector.

Another notable gainer included soy sauce manufacturer Kikkoman Corp., which gained 7.2 percent to 1,528 yen. Daiwa Institute of Research on Wednesday raised its rating on the stock to ''1'' from ''2'', saying the company has entered a growth stage for the mid to long term.

In the banking sector, Mitsubishi UFJ Financial Group (MUFG) added 1.3 percent to 1.55 million yen, after it said it has arranged to take a roughly 0 million stake in newly listed Bank of China, becoming one of 12 major institutional investors in China's second-biggest lender.

Trade volume fell with 1.7 billion shares changing hands compared with 1.9 billion shares on Wednesday. Decliners slightly outpaced advancers 914 to 702.

Reuters

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