Japan Nikkei bounces on bargain hunting

Headline indices of the Japan share market rebounded on Tuesday, 26 March 2019, as investors chased for bargain hunting following a 3% plunge the previous day. With the end of the business year-end looming on 31 March 2019 for a majority of listed Japanese companies, the market was also underpinned by investor purchases of stocks before they go ex-dividend later in the day. All 33 subsectors of the Tokyo Stock Exchange inclined, with shares in Land Transportation, Metal Products, Pharmaceutical, Construction, Warehousing & Harbor Transportation Services, Machinery, Nonferrous Metals, and Marine Transportation issues being notable gainers. Around late afternoon, the 225-issue Nikkei Stock Average rebounded 428.09 points, or 2.04%, at 21,405.20. The broader Topix index of all First Section issues on the Tokyo Stock Exchange advanced 39.51 points, or 2.5%, at 1,616.92.

Exporters rebounded, with Yaskawa Electric rising 2.4%, Advantest Corp up 2% and Panasonic Corp bouncing 2.9%. Mitsubishi Electric and Sony rose almost 3% each,% and Canon advanced almost 2%. Among the major automakers, Honda rose more than 2% and Toyota added more than 1%.

Among individual stocks, Nintendo Co jumped 5% after reports that the company plans to launch two new versions of its Switch gaming console later this year.

Renesas Electronics jumped 4% after the company said it will buy back up to 10 billion yen of its own shares.

On the economic front, the Bank of Japan said that producer prices in Japan were up 1.1% on year in February 2019, following the downwardly revised 1% increase in January 2019. On a monthly basis, producer prices were up 0.3% after sinking 0.6% in the previous month.

CURRENCY NEWS: The Japanese yen, widely viewed as a safe-haven currency, depreciated against the dollar on Tuesday as Treasury yields pulled back from 15-month lows as a modicum of calm returned to financial markets gripped by fears of a sharper downturn in the global economy. The dollar edged up 0.15 per cent to 110.13 yen and put some distance between a six-week low of 109.70 plumbed the previous day, when fears of a global economic slowdown depressed US yields and boosted investor demand for the yen, a perceived safe haven.

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