Nikkei up 0.7 pc, exporters rise on yen

Tokyo, Aug 21: Japan's Nikkei average rose 0.7 per cent on Tuesday with automaker Toyota Motor Corp. and other major exporters extending a winning streak on a softening yen and rising markets globally, suggesting receding concern over the stability of credit markets.

Tsuyoshi Segawa, an equity strategist at Shinko Securities, said investors were picking up shares that had been sharply oversold, including trading houses such as Mitsubishi Corp. and nonferrous metals, encouraged by an improving investor sentiment on Wall Street.

''The Tokyo market is getting back to normal as shares that should be bought are being bought and shares that should be sold are sold, in contrast to the across-the-board sell-off or buying of stocks seen in recent sessions,'' he said.

Still, Segawa said the Nikkei's gains would likely be limited.

''There remain investor anxieties. Coupled with profit-taking, the range is likely to be very narrow,'' he said.

The benchmark Nikkei average added 109.29 points to 15,841.77 by 0059 GMT after the benchmark jumped 3 per cent to 15,732.48 the previous day its biggest one-day percentage gain in 13 months.

The broader TOPIX index climbed 1.3 per cent on Tuesday to 1,542.94.

The dollar dipped 0.1 per cent to 114.75 yen from levels in late U.S. trade, but is well above a 14-month trough of 111.60 yen seen on Friday Among exporters, Toyota gained 2.2 per cent to 6,590 yen, consumer electronics maker Sony Corp. climbed 2.9 per cent to 5,360 yen and camera and office equipment giant Canon Inc. rose 1.7 per cent at 5,910 yen.

Shares of trading houses also gained with Mitsubishi up 5 per cent at 2,955 yen, while Mitsui&Co. Ltd. jumped 4.9 per cent to 2,240 yen.

Reuters>