Japan Nikkei extends gain on cheaper yen, trade truce hopes

The Japan share market finished higher on Monday, 25 November 2019, as investors continued for bargain hunting, thanks to a cheaper yen and on tacking gains on Wall Street late last week on growing optimism about the outlook for trade talks between major economies after positive trade dialogue. At closing bell, the 225-issue Nikkei Stock Average advanced 179.93 points, or 0.78%, to 23,292.81, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange added 11.62 points, or 0.69%, at 1,702.96.

Total 31 issues of the 33 industry category of Topix index inclined into positive territory, with Mining, Mining, Iron & Steel, Marine Transportation, Oil & Coal Products, Nonferrous Metals, and Securities & Commodities Futures issues being notable gainers.

 

Local shares were experiencing gains on the back of latest wave of optimism after US President Donald Trump said on Friday a trade deal with China is "potentially very close." Chinese President Xi Jinping also reiterated his desire on Friday for a preliminary trade deal. U.S. national security adviser Robert O'Brien has said so over the weekend. More importantly, China announced that it is willing to impose stricter penalties on intellectual property (IP) violations. IP has been one of the issues in which the two countries had difficulty seeing eye-to-eye on. Therefore, this move by China was widely welcomed by market participants as it is a step towards finalizing a phase one deal. That confidence was reinforced on Monday after reports that both countries were "very close" to a phase one trade deal and that China was willing to negotiate for a phase two or even a phase three trade deal.

CURRENCY NEWS: The Japanese yen, often viewed as a safe-haven currency in times of economic uncertainty, softened against greenback. The Japanese yen traded at 108.87 against the dollar after seeing an earlier high of 108.62.

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