Nikkei Rises Sharply as Dollar Gains on Hopes for Fed Rate Hike
TOKYO, March 22 Japan's Nikkei share average
rose sharply on Tuesday as the dollar extended its rebound
against the yen after two U.S. Federal Reserve officials
supported the case for an interest rate hike sooner than later. The Nikkei rose 2.1 percent to 17,066.07 by
mid-morning trade after falling 1.3 percent on Friday. Markets
in Japan were closed on Monday for a national holiday. A rise in Wall Street on Friday also helped investor
sentiment, with the S&P 500 closing positive for the year for
the first time in 2016. Atlanta Fed President Dennis Lockhart said there was
sufficient economic momentum to justify a further rate hike
"possibly as early as the meeting scheduled for end of April". San Francisco Federal Reserve Bank President John Williams
told Market News International that April or June would be
"potential times for a rate hike." The dollar rose back above 112.00 yen, recovering
from a 16-1/2 month trough of 110.67 hit last week, lifting such
exporters as Toyota Motor Corp and Honda Motor Co
, which rose 3.8 percent and 2.9 percent, respectively. "People who bought the yen and sold stocks last week seem to
be unwinding their positions," said Takuya Takahashi, a
strategist at Daiwa Securities. "The market will likely stay
resilient this week as buying before the ex-dividend date should
also help." For companies that close their books for their full year on
March 31, Monday is the final day that an investor could buy
their stock and qualify for dividends. Sharp Corp dived as much as 8.0 percent after
media reported that Taiwan's Foxconn is likely to reduce its
capital injection into Sharp from an initial plan of 489 billion
yen. The broader Topix gained 2.1 percent to 1,373.23,
with all of its 33 subsectors in positive territory. The JPX-Nikkei Index 400 advanced 2.1 percent to
12,403.75.
(Editing by Kim Coghill)
