Nikkei rises 1 pct; Dentsu up on earnings estimate

* Ad agency Dentsu among top percentage gainers in Nikkei 225

* Trading houses rise after rally in metal prices

* Broad swathe of sectors rise

* Euro zone rescue package for Greece helps market sentiment

By Masayuki Kitano

TOKYO, April 12 (BestGrowthStock) – Japan’s benchmark Nikkei average
rose 1 percent on Monday after better-than-expected U.S.
wholesale inventories underscored a recovery in the U.S. economy,
while ad agency Dentsu (4324.T: ) surged on improved earnings
guidance.

Mitsubishi Corp (8058.T: ) and other trading houses rose after
metals prices climbed, with gold hitting a 2010 high on Friday
and spot palladium hitting a two-year high early on Monday.
[ID:nLDE6380R0] [ID:nnTKU105936]

A broad swathe of Tokyo shares surged in the wake of the U.S.
Dow’s rise above 11,000 for the first time in a year and a half
on an upbeat outlook from Chevron (CVX.N: ) and the wholesale
inventories data.

News that euro zone finance ministers approved a giant 30
billion euro ($40 billion) emergency aid mechanism for
debt-plagued Greece on Sunday was another supportive factor,
analysts said. [ID:nLDE63A0BO]

Despite persistent concerns that the Nikkei’s recent rally
which took it to an 18-month high last week may have been too
much too fast, the outlook for the market seems positive,
analysts said.

“While there are some signs of overheating, the global
economy is recovering and there are high hopes for corporate
earnings,” said Hiroichi Nishi, general manager in the equity
division of Nikko Cordial Securities.

The Nikkei rose 1 percent to 11,314.42 (.N225: ), edging back
towards an 18-month intraday peak of 11,408.17 hit last week.

The broader Topix index (.TOPX: ) gained 1 percent to 999.02.

While the Nikkei’s trend looks bullish on daily Ichimoku
charts, other technical indicators suggest that the market is
overbought, with MACD getting close to flashing a sell signal.

The Nikkei is expected to find support at its 25-day moving
average that now lies near 10,950.

U.S. wholesale inventories rose more than expected in
February and sales at wholesalers reached their highest level in
16 months, brightening prospects for first-quarter economic and
earnings growth. [ID:nN09141748]

Dentsu Inc, Japan’s biggest advertising agency, surged 3.7
percent to 2,695 yen after raising its operating profit estimate
for the year ended in March to 33.9 billion yen ($364 million),
up 31 percent from its previous forecast. [ID:nT9A9NGJ9]

Dai-Ichi Life Insurance (8750.T: ), which debuted on the Tokyo
bourse this month following an $11 billion initial public
offering, rose 1.3 percent to 161,800 yen on expectations there
would be more demand for the stock as index compiler MSCI Barra
is due to add it to its indexes on April 15.

Among trading houses, Mitsubishi Corp rose 2 percent to 2,491
yen, Mitsui & Co (8031.T: ) climbed 3 percent to 1,659 yen, and
Itochu Corp (8001.T: ) rose 3.4 percent to 876 yen.

Stock Trading

(Additional reporting by Elaine Lies; Editing by Edwina Gibbs)

Nikkei rises 1 pct; Dentsu up on earnings estimate