Japan Nikkei gains on hopes for domestic firms' earnings

The Japan share market finished session higher on Monday, 21 October 2019, as investor sentiment was buoyed by hopes that domestic corporate earnings season starting this week would be robust. However, market gains capped as worries about European political instability after UK Prime Minister Boris Johnson failed to secure the votes needed to pass the Brexit deal he struck with the EU. At closing bell, the 225-issue Nikkei Stock Average was up 44.44 points, or 0.2%, to 22,496.30, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 2.01 points, or 0.1%, at 1,622.15.

Total 26 issues of the 33 industry category of Topix index inclined into positive territory, with Securities & Commodities Futures, Iron & Steel, Construction, Services, Real Estate, and Nonferrous Metals issues being notable gainers, whereas Marine Transportation, Pharmaceutical, and Air Transportation issues were notable losers.

Brexit developments over the weekend created further uncertainty over the United Kingdom's impending departure from the European Union. U.K. Prime Minister Boris Johnson was thwarted by a cross-party group of politicians in Parliament who voted to postpone the meaningful vote on his new Brexit deal. That forced Johnson to ask Brussels for an extension to the current October 31 departure deadline, but EU leaders don't necessarily have to accept it. This week, the British government will present the full Withdrawal Agreement Bill to try and pass it through both the upper and lower houses of Parliament. A decisive vote by lawmakers would likely come later in the week.

On the U.S. and China trade development, the U.S. and China made 'substantial progress' at trade talks, according to Chinese Vice Premier Liu He. After reaching a partial trade deal earlier this month, Beijing and Washington are working to pen a written agreement. Both sides have applied tariffs on billions of dollars worth of each other's products, which have roiled global markets, created business uncertainty and dented economic outlooks around the world. China said last week its economy grew by 6% on-year in the third quarter, which is believed to be the slowest GDP gain for the country in at least 27.5 years.

CURRENCY NEWS: The Japanese yen, often viewed as a safe-haven currency in times of economic uncertainty, was tad stronger against greenback after UK Prime Minister Boris Johnson failed to secure the votes needed to pass the Brexit deal he struck with the EU. The Japanese yen traded at 108.49 per dollar, compared with 108.37-47 yen in New York and 108.64-65 yen on Friday in Tokyo.

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