Tokyo stocks up 1.21% by noon

I / Tokyo November 14, 2011, 9:47 IST

Tokyo stocks rose 1.21% today amid easing pessimism over Europe's debt crisis as former EU commissioner Mario Monti was nominated to head a new Italian cabinet.

The Nikkei 225 index at the Tokyo Stock Exchange gained 102.80 points to 8,617.27 by the lunch break. The Topix index of all first-section issues added 0.90%, or 6.56 points, to 735.69.

The nomination of Monti as Italy's new prime minister gave rise to hopes that the new government will help the country implement key economic reforms.

"Excessive pessimism about European conditions has temporarily subsided, but the situation does not yet allow us to be wildly optimistic," Yutaka Miura, a senior technical analyst at Mizuho Securities, told Dow Jones Newswires.

Yutaka Yoshii, a general manager at Mito Securities, said: "Nobody is trading on the premise that concerns in Europe have been eradicated."

Just before the opening bell, government data showed Japan's economy grew by an annualised 6.0% in the July-September quarter, the first gain since March's earthquake and tsunami disaster and the first growth in four quarters.

"While there are concerns of an economic slowdown across the globe, there is some temporary relief that Japan's July-September GDP is better than other developed economies," said Yoshinori Nagano, a senior strategist at Daiwa Asset Management.

"But uncertainty for the October-December period remains strong," he added. Many economists have warned about Japan's outlook with the strong yen and the slowing global economy hurting its exports.