Japanese shares track Wall Street higher on Powell's testimony

  • 1/12/2022
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TOKYO, Jan 12 (Reuters) - Japanese shares rebounded on Wednesday, as investors scooped up beaten-down stocks after less-hawkish comments from U.S. Federal Reserve Chairman Jerome Powell helped Wall Street regain ground. The Nikkei share average (.N225) closed 1.92% higher at 28,765.66, its biggest daily gain since Dec. 21, while the broader Topix (.TOPX) rose 1.64% to 2,019.36, after three straight sessions of losses. U.S. stocks bounced overnight, with the Nasdaq leading the advance, as investors digested Powell"s remarks that interest rates were likely to rise this year, as expected. "Powell"s remarks were not as hawkish as we had expected, and that boosted the U.S. growth stocks and the Japanese market followed suit," said Ikuo Mitsui, fund manager at Aizawa Securities. "But this momentum may not last for long because we have U.S. consumer price data, and depending on its outcome the U.S. market may decline, which will affect the Japanese market." U.S. consumer inflation data is due later in the day, with headline CPI seen coming in at a red-hot 7% on a year-on-year basis, boosting the case for an early increase in interest rates. Nikkei heavyweights led the gains, with chip-making equipment maker Tokyo Electron (8035.T) rising 3.75%, tech-investor SoftBank Group (9984.T) jumping 6.03% and Uniqlo clothing shop owner Fast Retailing (9983.T) adding 1.75%. Shares that were sold off recently due to their high price-earnings ratios regained as U.S. Treasury yields fell. Sensor maker Keyence (6861.T) jumped 4.98% after losing more than 11% over the past week, while motor maker Nidec (6594.T) rose 2.63% after losing 7% during the same period. Inpex (1605.T) rose the most on the Nikkei with a gain of 6.48%, and Kawasaki Kisen Kaisha (9107.T), which climbed 5.03%, was also a top performer. Eisai , which fell 2.31%, was the worst performer in the Nikkei, followed by Shinsei Bank (8303.T), losing 1.65%.

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