Tokyo, Dec. 4 (Jiji Press)–Stocks rebounded on buybacks on the Tokyo Stock Exchange Thursday morning, but the key Nikkei average became top-heavy after approaching a major resistance line of 10,500.
“Investors covered short positions as they found difficulty chasing stocks lower,” said Yutaka Miura, equity manager at Shinko Securities Co. “The market was underpinned by expectations that U.S. stocks may pick up following chip giant Intel Corp.’s mid-quarter update (on business performance) later in the day and the release of U.S. jobs data on Friday.”
At the morning finish, the 225-issue Nikkei average stood up 72.63 points at 10,399.02. On Wednesday, the average shed 83.76 points.
The TOPIX index of all first-section issues was up 4.63 points at 1,020.70. It ended down 7.43 points the previous day.(MORE)Tokyo Stocks Rebound in Morning on Buybacks
Rising issues eclipsed losers 733 to 606 on the first section in the morning, while 181 issues were flat.
Half-day volume came to 689 million shares.
After opening slightly higher, the key market gauge gradually widened its gains to hit a high of 10,449.54 in midmorning, as mainstay technology names recovered from their early losses. But it faced pressure around that level and lost momentum.
Kenichi Hirano, equity general manager at Tachibana Securities Co., said the Nikkei average needs an additional support factor, such as stepped-up buying by foreign investors, to break through the 75-day moving average, which came to 10,480.23 as of Wednesday.
Market sources said foreign brokerage houses posted net buying for the sixth straight session in their preopening order placement Thursday, while the Ministry of Finance report showed that nonresidents turned net buyers in the Nov. 25-28 week.
Hirano said foreign hedge funds which failed to join the Nikkei’s steep rally earlier this year are expected to become net buyers in December in anticipation of Japanese stocks’ brisk performance next year.(MORE)Tokyo Stocks Rebound in Morning on Buybacks
Among technology issues, Canon posted solid gains following a Nihon Keizai report that the company will enter the flat television market with Toshiba under their existing partnership accord on a new technology called surface conduction on electron emitter display. Toshiba, Hitachi, Advantest also ended the morning higher, while Sony fell.
Telecom carriers NTT, NTT DoCoMo and KDDI attracted purchases and steelmakers Nippon Steel and Sumitomo Metal Industries were also firm.
Major banking groups Mizuho, UFJ and Sumitomo Mitsui declined, but big brokerages like Nomura and Daiwa logged gains.
Consumer finance company Takefuji continued to sink on a wave of selling sparked by the arrest of its founder and chairman Yasuo Takei on suspicions that he played a key role in a wiretapping case.END
