Tokyo stocks likely to hold firm while investors wait for key earnings reports
Jiji Press TOKYO (Jiji Press) — Tokyo stocks are seen holding firm this week, with investors keeping a close eye on earnings reports from major domestic firms.
Last week, the benchmark 225-issue Nikkei average jumped 328.22 points, or 1.95 percent, to close at 17,184.59 on Friday. Both the Nikkei average and TOPIX index extended their winning streaks to a fifth session through Thursday, helped by a rally in crude oil prices and the yen’s weakening trend.
Investors also took heart from news that Democratic candidate Hillary Clinton was dominant in the third and final U.S. presidential debate with Republican rival Donald Trump. The debate was held during Tokyo trading hours on Thursday.
“Market participants are turning into ‘risk on’ mode on the back of receding external worries,” said Tomoaki Fujii, head of the corporate research division at Takagi Securities Co.
This week, Japan’s corporate earnings reporting season is expected to swing into full gear.
Concerns have been seen about sharp earnings deterioration at key export-oriented companies, following the yen’s strengthening versus the dollar, from a dollar rate of around ¥120 a year earlier.
But such worries have started to recede in the wake of recent stable movements for the dollar-yen pair, brokers said.
Major companies scheduled to announce earnings include camera maker Canon and game producer Nintendo, both on Wednesday, chemical firm Fujifilm, on Thursday, and construction machinery manufacturer Komatsu, on Friday. Meanwhile, railway operator JR Kyushu is due to be listed on the TSE’s first section on Tuesday. Attention will focus on the initial market price of the company’s stock and its movements after the opening.
“The Nikkei is likely to move on a firm note around 17,000-17,500, but a possible tumble in crude oil prices and negative news linked to Deutsche Bank could be risk factors,” said Hideyuki Ishiguro, senior strategist at Daiwa Securities Co. Speech
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