Japan's Nikkei hits 6-wk peak, higher bond yields lift banking sector

Credit: REUTERS/ISSEI KATO

Japan's Nikkei brushed a six-week peak on Tuesday, with exporters lifted by a weaker yen and a bounce in bond yields buoying the banking sector.

By Shinichi Saoshiro

TOKYO, Sept 10 (Reuters) - Japan's Nikkei brushed a six-week peak on Tuesday, with exporters lifted by a weaker yen and a bounce in bond yields buoying the banking sector.

The Nikkei share average .N225 ended the day up 0.35% at 21,392.10 after touching 21,438.35, its highest since Aug. 1. There were 161 advancers on the Nikkei index against 64 decliners.

The index has risen for the sixth consecutive session as an ebb in U.S.-China trade war concerns has lifted global equities.

"The market's rise is a continuation of its recent gains. The advance has slowed, however, with a wait-and-see mood setting in ahead of some key monetary policy decisions," said Yoshinori Shigemi, global market strategist at JP Morgan Asset Management.

The European Central Bank will review policy on Thursday and the Federal Reserve begins a two-day meeting on Sept. 17, followed by the Bank of Japan on Sept. 18-19.

Shares of exporting automakers rose as the yen slipped to its lowest level since early August against the dollar.

Toyota Motor Corp 7203.T added 1.3%, Honda Motor Co 7267.T climbed 2.4% and Subaru 7270.T gained 2.3%.

Nissan Motor Co 7201.T advanced 3.7%, outperforming its peers after news that company CEO Hiroto Saikawa will resign, bowing to pressure after he admitted to being improperly overpaid.

Mitsubishi UFJ Financial Group 8306.T gained 4%, Mizuho Financial Group 8411.T rose 3.3% and Sumitomo Mitsui Financial Group 8316.T climbed 3.4% thanks to a rebound in bond yields, which are expected to reinforce banks' profitability.

Yields of major government bonds pulled back sharply from recent lows as risk appetite improved and lessened investor demand for safe-haven debt.

Shares of companies with heavy exposure to China gained amid the continuing retreat in U.S.-China trade conflict concerns. Construction machinery makers Komatsu Ltd 6301.T and Hitachi Construction Machinery Co 6305.T rose 3% and 4.5%, respectively. Robot manufacturer Fanuc Corp 6954.T advanced 3.2%.

The broader Topix .TOPX rose 0.44% to 1,557.99.

The stocks that gained the most among the top 30 core names in Topix were Mitsubishi UFJ Financial Group, followed by followed by Panasonic Corp 6752.T, which rose 3.4%.

The weakest performers in the Topix 30 were Recruit Holdings Co Ltd 6098.T, which fell down 2.6%, followed by Sony Corp's 6758.T loss of 2%.

The volume of shares traded on Topix was 1.21 billion yen, compared to the average of 1.11 billion in the past 30 days.

(Editing by Kim Coghill)

((shinichi.saoshiro@thomsonreuters.com; +813-6441-1774))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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