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Feb 8-Japan's Nikkei leaps to 2-week high on tech stocks, yen boost

Published 02/08/2024, 02:46 AM
Updated 02/08/2024, 07:07 PM
© Reuters. FILE PHOTO: A pedestrian is reflected on a glass of a business building while an electric board showing Nikkei index is seen in the building  at a business district in Tokyo, Japan January 23, 2024. REUTERS/Kim Kyung-Hoon/File Photo

(Corrects analyst's name to Kenji Abe from Shinji Abe)

By Kevin Buckland

TOKYO (Reuters) -Japan's Nikkei share average hit a more than two-week high on Thursday, as tech stocks followed their Wall Street peers higher and a weakening yen lifted overall sentiment.

The Nikkei rallied 1.71% to 36,738.42 by the lunch break, after rising to 36,741.87, a level last seen on Jan. 23, when the index reached a more than three-decade high of 36,984.51.

Artificial intelligence (AI)-focused startup investor SoftBank (TYO:9984) Group provided the biggest boost in terms of index points, surging 9.69% after key holding Arm forecast sales and profit exceeding the market's expectations.

Chip-testing equipment maker and Nvidia (NASDAQ:NVDA) supplier Advantest was a close second, jumping 7.08%. Overnight, the Philadelphia SE Semiconductor Index climbed 1.62% to handily outperform Wall Street's three main indexes.

The broader Topix rose 0.46%. A Topix index of growth shares rallied 0.78%, easily outpacing a 0.15% rise for value shares.

Meanwhile, a weakening yen helped to accelerate Japanese stock gains. The currency slid as much as 0.3% against the dollar as Bank of Japan Deputy Governor Shinichi Uchida said aggressive tightening is unlikely even after an exit from negative interest rate policy.

A weaker currency helps exporters by boosting the value of overseas revenue and making products more competitive.

Toyota Motor (NYSE:TM) extended gains to reach a record high, and was last up 4%. The stock has been climbing strongly since posting robust earnings on Tuesday.

"Toyota's strategy to continue to emphasize hybrid cars seems to be winning over investors," said Kenji Abe, an equity strategist at Daiwa Securities, adding the Nikkei would likely reach 37,000 by end-March amid stronger-than-expected earnings this season.

Financial results continued to produce outsized winners and losers, as the reporting season heads for a crescendo next Wednesday.

© Reuters. FILE PHOTO: A pedestrian is reflected on a glass of a business building while an electric board showing Nikkei index is seen in the building  at a business district in Tokyo, Japan January 23, 2024. REUTERS/Kim Kyung-Hoon/File Photo

Suzuki Motor bucked the trend among automakers to slide 7.34% after its earnings disappointed. Internet company DeNA slumped 12.17% to lead losses on the Nikkei.

At the other end, pharmaceuticals firm Kyowa Kirin was the biggest gainer, surging 18.14% after announcing a share buyback.

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