Japan Market gains on solid GDP growth data

Japan share market closed session modestly higher on Monday, 20 May 2019, as a risk-on mood continued after government data showed that Japan's economy grew at an annualized rate of 2.1% in the January-March quarter, supporting a moderate recovery of the Japanese economy. Stocks were also being supported by reports that Prime Minister Shinzo Abe may call a snap general election to coincide with an upper house election due this summer. But the market's topside was capped partly because of ongoing U.S.-China trade tensions. Most of subsectors of the Tokyo Stock Exchange inclined, with gainers were led by real estate, farm and fishery, and land transportation issues. At closing bell, the 225-issue Nikkei Stock Average advanced 51.64 points, or 0.24%, at 21,301.73, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange grew 0.67 point, or 0.04%, at 1,554.92.

The positive start came after government data showed the world's third-largest economy grew at an annualised rate of 2.1%, accelerating slightly from the previous quarter's growth backed by net export gains.

 

Investors remained concerned about the US-China trade row and were also watching how talks on threatened US auto tariffs will go.

Shares of real estate issue inclined after January-March GDP data showed private residential investment climbed 1.1%. Mitsui Fudosan advanced 2.2% to 2,640 yen and Mitsubishi Estate climbed 2.2% to 2,112.00 yen.

Shares of technology issues and companies with heavy exposure to the Chinese market were hit by the continuing trade tensions between the world's largest two economies. Electronics and semiconductor maker Tokyo Electron sank 3.1% to 15,715 yen and Industrial robot manufacturer Yaskawa Electric dived 5.7% at 3,380 yen.

Hokuetsu rocketed 9.03% after the paper manufacturer said Friday it expects to enjoy a 62.9% rise in group operating profit in the business year to next March.

Maruha Nichiro was up 3.57% thanks to a media report that the seafood producer will start full-scale exports of fully farmed tuna to Europe thanks to the Japan-European Union economic partnership agreement taking effect this year.

Japan Display tumbled 8.77% on a media report that a China-Taiwan consortium is demanding a review in conditions for its envisaged investment in the struggling liquid crystal display panel maker.

CURRENCY NEWS: The Japanese yen depreciated against the dollar on Monday, on a broad improvement of risk appetite among investors after data showed the Japanese economy was stronger than expected in the last quarter. The dollar firmed to 110.18 yen from 110.02 yen in New York on Friday.

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