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Nikkei gains sharply to 18,000 level on BOJ fund buying impact

13 Comments

Tokyo stocks soared Tuesday, with the Nikkei index logging its biggest point rise since September 2015 to retake the 18,000-point line, as market sentiment improved after the Bank of Japan's recent purchases of exchange-traded funds as part of its additional monetary easing measures.

Buying of stocks paying high dividends as the business year for many Japanese companies ends next week and the yen's weakness against the U.S. dollar also lifted Tokyo stocks.

The 225-issue Nikkei Stock Average ended up 1,204.57 points, or 7.13 percent, from Monday at 18,092.35. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 41.09 points, or 3.18 percent, higher at 1,333.10.

Gainers were led by mining, securities house and marine transportation issues.

Tokyo shares quickly expanded gains after opening and held an upbeat tone for the rest of the day, with buybacks continuing to kick in following the recent sharp declines.

"Shares were bought as investors' need to seek the safety of holding dollars in cash eased somewhat," said Chihiro Ota, general manager of investment research at SMBC Nikko Securities Inc.

In addition, "hopes of buying by the BOJ helped boost investor sentiment," said Toshikazu Horiuchi, equity strategist at IwaiCosmo Securities Co.

The BOJ decided last week to double its purchasing of exchange-traded fund securities to 12 trillion yen ($112 billion) a year as part of the first additional easing measures in three and a half years to battle the new coronavirus outbreak. The bank bought over 200 billion yen worth of ETFs for the second straight trading day through Monday.

Horiuchi added that the Tokyo market also saw retail investors seek shares to secure the right to receive dividends ahead of the end of the fiscal year and institutional investors move to reinvest in stock futures after securing dividends.

Among issues of companies paying relatively large dividends, Japan Airlines climbed 75.50 yen, or 3.9 percent, at 2,027.00 yen, retailer Aeon advanced 79.50 yen, or 3.7 percent, to 2,213.00 yen and securities house Nomura Holdings surged 34.20 yen, or 8.4 percent, to 443.50 yen.

SoftBank Group surged 604 yen, or 19.0 percent, to 3,791 yen, after the company said Monday it will sell up to 4.5 trillion yen ($41 billion) of assets to expand share buybacks and reduce debt in an effort to bolster its share price.

On the First Section, advancing issues outnumbered decliners 1,748 to 394, while 26 ended unchanged.

Trading volume on the main section fell to 2,256.86 million shares from Monday's 2,697.39 million shares.

© KYODO

©2020 GPlusMedia Inc.

13 Comments
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Yes BOJ will buy all.. , can not understand why people have to work... the BOJ can support anyone with fake printed money.

7 ( +9 / -2 )

Is the article talking about another SoftBank? According to the tokyo stock exchange, it’s currently 46 yen down at 1368.

-3 ( +1 / -4 )

@ Bugle Boy

Is the article talking about another SoftBank? According to the tokyo stock exchange, it’s currently 46 yen down at 1368.

Softbank Group is valued at the price listed in the article while Softbank, the mobile division is listed at the price you are referencing.

5 ( +5 / -0 )

Will be down by the same this time next week.

The volatility likely not over yet.  when it is those with cash will make some money.

4 ( +5 / -1 )

".... monetary easing measures ......"

If it was that easy for me to get more money.

Don't see no "easing" when looking at my pay-check.

But maybe I'm just confused again.

1 ( +2 / -1 )

Plus if some of this is BoJ ETF buying then guess for the first time they might make some money on their asset purchases.

0 ( +0 / -0 )

Ultimatelty, higher taxpayers debt going into the pockets of those who choose to and can afford to buy stocks.

As always the gov't is going all out to protect the fake free market economy at the expense of all else ... including rational thought.

2 ( +3 / -1 )

The economic health looks like going forward will get a very bad dose of virus. Japan will be the first country to show a negative economy but al the other countries will follow suit. There will be a whole bunch of hurt for millions of people across the globe.

Oil is down to $26/barrel.

2020 is going to be a difficult year for all.

3 ( +3 / -0 )

@JJ Jetplane. You are right. I dropped the ball on this one. I called my stock agent and she straightened me out.

So, I bought some shares. Hopefully, we’ll see a repeat of today’s performance tomorrow.

-2 ( +0 / -2 )

Government money buying up stock?

How on earth does an airline show robustness at this time yet JAL gained just under 4%.

Most JAL employees aren’t even working at present.

I was working today so I must be up at least 8%!

3 ( +3 / -0 )

Oil is down to $26/barrel.

2020 is going to be a difficult year for all.

Except for truck drivers, taxi drivers and SUV owners.

2 ( +2 / -0 )

So, cheaper oil means cheaper consumer goods right?

0 ( +0 / -0 )

Sold my shares in Softbank Group. Made about 100,000. Not bad for a single day.

-1 ( +0 / -1 )

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