Japan Stocks gains on firm offshore cues, weaker yen

Headline indices of the Japan share market inclined on Monday, 09 July 2018, following the gains on Wall Street Friday after the release of better than expected US employment figures. Meanwhile, the relatively cheaper yen against the dollar also supporting the market. Almost all TSE33 issues inclined, with shares in Pharmaceutical, Financial Business, Services, Information & Communication, Metal Products, Electric Power & Gas, and Banks issues being notable gainers. At the close, the benchmark Nikkei 225 index added 1.21%, or 264.04 points, to 22,052.18. The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, rose 1.2%, or 20.25 points, to 1,711.79.

Share of major exporters were mostly higher, with Sony Corp, Mitsubishi Electric, Toyota, and Canon were up in a range of 1% to 2%.

On the flip side, Otsuka Holdings and Hitachi Construction Machinery were declining in a range of 3% to 4%.

In economic news, the Bank of Japan said that overall bank lending in Japan was up 2.2% on year in June, coming in at 524.847 trillion yen. That follows the 2.0% gain in May.

Japan posted a current account surplus of 1,938.3 billion yen in May, the Ministry of Finance said on Monday, up from 1,845.1 billion yen in April. The trade balance reflected a deficit of 303.9 billion yen, following the 573.8 billion yen surplus in the previous month. The adjusted current account surplus was 1,850.0 billion yen, following the 1,885.5 billion yen surplus a month earlier.

CURRENCY NEWS: The Japanese yen slightly depreciated to the mid 110 yen zone against greenback on Monday. The dollar was quoted at 110.43-44 yen compared with 110.40-50 yen in New York and 110.57-58 yen on Friday in Tokyo. The euro, meanwhile, fetched 129.75-78 yen against 129.66-76 yen in New York and 129.39-43 yen in late Friday afternoon trade in Tokyo.

OFFSHORE MARKET: U.S. stocks closed higher on Friday as relatively upbeat jobs report offset worries about trade tensions between the U.S. and China. The Dow Jones Industrial Average gained 99.74 points or 0.41% to 24,456.48, the S&P 500 rose 23.21 points or 0.85% to 2,759.82 and the Nasdaq Composite Index added 101.96 points, or 1.34%, to 7,688.39.

The European markets ended with modest gains on Friday after staging a late recovery. The DAX of Germany climbed 0.26% and the CAC of France rose 0.18%. The FTSE 100 of the U.K. gained 0.19%.

COMMODITIES: Crude oil prices mixed on Friday. The continued supply outage at Canada's Syncrude oil sands facility supported US crude prices. But Saudi Arabia increased oil production by 458,000 barrels per day in June according to OPEC, pushing the Brent crude price lower. Brent crude fell by US28 cents or 0.4% to US$77.11 a barrel, but the US Nymex rose by US86 cents or 1.2% to US$73.80 a barrel. For the week, the Nymex lost 0.5% and Brent fell by 2.9%.

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