Nikkei breaks resistance, up 2.6 pct after Intel

* Nikkei above resistance at level of 25-day moving average

* Next target 10,000, then 10,250, but will take time-analyst

* Chip-related shares, techs surge after robust Intel results

By Elaine Lies

TOKYO, July 14 (BestGrowthStock) – Japan’s Nikkei surged more than 2
percent on Wednesday to shoot above a key resistance level, with
chip-related shares powering higher after Intel results beat
expectations, easing fears about the U.S. economic recovery.

The benchmark climbed well past resistance at around 9,677,
the level of its 25-day moving average, which it broke above for
the first time in three weeks.

Resilient demand for personal computers and servers helped
Intel Corp (INTC.O: )’s margin and revenue forecasts, out after the
bell, blast past expectations, allaying fears of a possible tech
spending slowdown and setting an upbeat tone for the industry’s
earnings season. [ID:nN12197658].

The announcement came on the heels of better-than-expected
quarterly earnings from Alcoa (AA.N: ) the day before, giving heart
to investors who had fled to the sidelines on jitters about the
economic recovery. [.N]

“There’s been growing doubts about the health of the U.S.
economy, but these better-than-expected Intel results have really
changed sentiment in the market,” said Toshiyuki Kanayama, a
market analyst at Monex Inc.

“Wall Street rose strongly, there was Intel, and the yen is
also weaker. A lot of good factors for stocks are now lining up.”

The benchmark Nikkei (.N225: ) surged 2.6 percent or 249.04
points to 9,786.01, while the broader Topix (.TOPX: ) gained 2.1
percent to 872.43.

Market players said short-covering emerged after the Nikkei
broke above its moving average and additional resistance on its
daily Ichimoku charts at around 9,670 which was its kijun sen, an
indicator of medium-term trends. Ichimoku charts are a popular
charting method among Japanese traders.

The Nikkei also broke above the middle line of its Bollinger
Bands, around 9,643, after being stuck below it for the past
several trading days, while its MACD continued to rise.

But some in the market remained wary, noting that further
rises could be hard to achieve.

An accumulation of long positions in the market, especially
in blue-chip exporters, means that any further rises are likely
to take time, Kanayama added.

The Nikkei’s next target is 10,000, a key psychological
level, and then around 10,250, the level of its June high.

Chip gear manufacturer Tokyo Electron (8035.T: ) and other tech
shares gained after the Intel results, with Tokyo Electron shares
climbing 4.1 percent to 5,110 yen.

Chip-tester maker Advantest Corp (6857.T: ) shot up 5.2 percent
to 2,004 yen, and Nikon (7731.T: ), a maker of steppers, advanced
2.4 percent to 1,649 yen.

Shares of Komatsu (6301.T: ), the world’s No.2 construction
machinery maker, shot up 5.7 percent to 1,795 yen after it lifted
its full-year profit forecast by nearly a quarter, citing
better-than-expected first-half sales in Asia and Latin America,
as well as a pick up in demand in Japan and the United States.

Nikkei breaks resistance, up 2.6 pct after Intel