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Nikkei rebounds as blue chips, metal shares up

By Staff
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Google Oneindia News

TOKYO, Aug 13 (Reuters) - Japan's Nikkei average rose 0.4 percent on Monday as investors, reassured by central bank moves to inject funds into the banking system, bought Kyocera Corp. and others that logged sharp losses last week.

Shares of NEC Electronics Corp. jumped after a report that it aims to double its sales in China, while energy-related stocks gained ground after commodity prices rebounded.

To alleviate the money market squeeze, major central banks have injected sizable amounts of overnight funds, which many market participants see as a positive move.

''There is a sense of relief spreading in the market after the fund injections. Foreign exchange rates are also steady,'' said Hiroyuki Fukunaga, a chief strategist in the research division at Rakuten Securities.

On Monday, the Bank of Japan pumped 600 billion yen of funds into the banking system in a one-week operation as tight conditions in money markets abroad spilled over into Japan's call market. The move followed a 1 trillion yen injection of overnight funds the central bank supplied on Friday.

Still, Fukunaga said credit concerns remain, and he expects the market to stay volatile going forward.

''It's the 'o-bon' holiday week in Japan, but trade volume is not low. I think there are a lot of players out there,'' he said.

The Nikkei added 69.84 points to 16,833.93 as of 0446 GMT while the broader TOPIX index rose 0.13 percent to 1,636.10.

The benchmark ended Friday down more than 2 percent at its lowest close since March 16, while the TOPIX logged its lowest close this year, passing the year-low finish booked on Jan. 11.

Investors bought back stocks that appeared to have been oversold in last week's sell-offs.

Kyocera, an electronics parts maker, added 3.5 percent to 10,780 yen, recouping some its 7.6 percent decline from the last two sessions, and Shin-Etsu Chemical Co. Ltd. rose 3.1 percent to 8,270 yen, snapping a four-day losing streak.

In the nonferrous metals sector, shares of top-ranked smelter Mitsubishi Materials Corp. surged 10.1 percent to 641 yen while Sumitomo Metal Mining Co. Ltd. climbed 5.5 percent to 2,405 yen.

Shipping firm shares also gained. Kawasaki Kisen Kaisha Ltd. , which has lost 13 percent this month, rose 3.6 percent to 1,481 yen, while Mitsui O.S.K. Lines Ltd. added 2.5 percent to 1,639 yen.

Meanwhile, Bridgestone Corp, the world's biggest tyre maker by revenue, added 2.7 percent at 2,625 yen after the Nikkei business daily reported that the company plans to boost output capacity in emerging markets such as India and Turkey.

The market largely ignored government data showing that Japan's economy grew 0.1 percent in April-June from the previous quarter, falling just short of market expectations for a 0.2 percent rise.

REUTERS SI HT1120

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