Nikkei hits 8-week closing high after BOJ

By Aiko Hayashi

TOKYO (BestGrowthStock) – The Nikkei average hit an eight-week closing high on Wednesday after the Bank of Japan eased policy in a move seen by many as an attempt to prevent the yen from rising and as chip shares gained on hopes of positive earnings guidance from Intel (INTC.O: ).

Elpida Memory (6665.T: ) climbed on a media report of upbeat earnings, while consumer finance firms were in favor with Promise Co (8574.T: ) gaining on report it was set to secure funds and Aplus (8589.OS: ) surging after Shinsei Bank (8303.T: ) said it would raise its stake in the firm.

The central bank doubled the size of a lending operation it put in place at an emergency meeting in December but did not extend its duration.

The yen slid to the day’s lows on the dollar and euro on Wednesday as some took the view that the Bank of Japan move was an easing of policy even if it was less aggressive than expected.

“The impact will be factored in today. The focus will now shift to earnings, and as they have been steadily improving, I expect to see little downside risk for the Nikkei for a while — it’s unlikely to break below 10,500,” said Masaru Hamasaki, senior strategist at Toyota Asset Management.

The Nikkei climbed 1.2 percent to 10,846.98 (.N225: ), its highest finish since January 21. The index gained momentum after it broke above 10,808.73, the settlement price of Nikkei futures and options contracts expiring in March, some players said.

The broader Topix (.TOPX: ) rose 1 percent to 947.43 (.TOPX: ).

The Nikkei earlier got additional support after the Federal Reserve maintained its pledge to keep interest rates low for an extended period, which lifted U.S. shares to a 17-month high. (.N: )


Chip-related stocks rose broadly after Intel shares jumped 4 percent on Tuesday on speculation that the world’s top chip maker is expected to release positive guidance for the current quarter, and the Philadelphia semiconductor index (.SOXX: ) gained 2.7 percent. (.N: )

Chip equipment maker Tokyo Electron (8035.T: ) rose 1.4 percent to 5,910 yen and Advantest (6857.T: ), which supplies chip testers to chip makers such as Intel, gained 1.4 percent to 2,229 yen.

Elpida Memory, the No.1 Japanese maker of DRAM chips, climbed 1.6 percent to 1,776 yen. The Nikkei business daily said the company is set to return to the black with an operating profit of almost 20 billion yen ($222 million) for the year ending this month, which would beat consensus forecasts of 16.5 billion yen.

Consumer lender Promise jumped 5.2 percent to 815 yen after the Nikkei business daily reported the company will likely raise about 50 billion yen via asset-backed securities.

Aplus surged 6.5 percent to 99 yen after Shinsei Bank said it would raise its stake in the firm to over 90 percent as it looks to revamp the group’s consumer finance business.

Nissan Motor (7201.T: ) gained 2.5 percent to 774 yen on speculation that it and Renault may form an equity tie up with Daimler (DAIGn.DE: ).

Shares in nonferrous smelter Mitsui Mining & Smelting Co (5706.T: ) climbed 5.8 percent to 273 yen, after the company raised its operating profit forecast for the financial year ending this month to 25 billion yen ($277 million) from 21 billion yen.

Some 2 billion shares changed hands on the Tokyo exchange’s first section, falling from Friday’s seven-week high, when volume was 2.8 billion shares.

Advancing stocks outnumbered declining ones by 4 to 1.

Stock Market Trading

(Editing by Edwina Gibbs and Chris Gallagher)

Nikkei hits 8-week closing high after BOJ