Japan stocks hit multi-decade high on economic optimism
Reuters
Published Feb 15, 2021 02:48
By Stanley White
TOKYO (Reuters) - Japanese shares rose on Monday and briefly touched a more than 30-year high on rising expectations for a rebound in corporate earnings and economic growth.
The Nikkei index rose 1.08% to 29,839.67 by 0152 GMT, with energy and healthcare shares leading gains. Early in trading, the index rose to 30,006.46, reclaiming the psychologically important 30,000 level for the first time since August 1990.
The broader Topix rose 0.66% to 1,946.59, also its highest since 1991.
Shares of companies that have reported positive earnings rose, as investors continued to place bets on sectors that are expected to perform well as the global economy recovers from the coronavirus pandemic.
Japan is expected to start coronavirus vaccinations this week, which is also supporting stock prices. However, Japanese stocks have rallied 8% so far this month, and some analysts warn that the market may be overheating.
"Stocks have risen so fast you could say they've broken the speed limit," said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank.
"Earnings growth has already been priced in for at least a year from now. There is reluctance to chase the upside from here, but stocks won't fall too much."
Equities also got a boost after data showed Japan's gross domestic product grew faster than expected in the fourth quarter.
The stocks that gained the most among the top 30 core Topix names were Daiichi Sankyo Co Ltd, up 2.71 %, followed by Seven & i Holdings Co Ltd, up 2.15%.
The underperformers among the Topix 30 were Hitachi Ltd, down 0.92%, followed by Recruit Holdings Co Ltd that lost 0.74%.
There were 134 advancers on the Nikkei index against 89 decliners.
The volume of shares traded on the Tokyo Stock Exchange's main board was 0.61 billion, compared to the average of 1.26 billion in the past 30 days.
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Written By: Reuters
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