Tokyo stocks extend rise on economy boost, Wall St 11:25, Tuesday, 8 June 2004
(Updates to mid-morning)
TOKYO, June 8 (Reuters) - Japanese stocks rose by mid-morning on Tuesday as a Wall Street rally and growing confidence over a recovery in the domestic economy and corporate earnings fuelled buying of both banks and technology stocks.
Shares of firms dealing with raw materials such as metal and paper manufacturers and oil-related stocks also lured buying, suggesting a recovery in individual investors' appetite, analysts said.
The Nikkei average <.N225> rose 0.59 percent to 11,507.63 by 0102 GMT, adding to Monday's 2.8 percent jump. The key gauge also topped the 11,500 line for the first time since May 7 on an intraday basis.
The broader TOPIX index <.TOPX> was up 0.51 percent at 1,157.67 after closing Monday's session up 2.37 percent.
Analysts said the market's focus had returned to solid fundamentals at home after oil prices stabilised below $40 a barrel and U.S. stocks extended gains following strong jobs figures for May.
There were also growing expectations that Japan's January-March gross domestic product (GDP) growth would be revised higher on Wednesday, they said.
Preliminary figures released on May 19 said GDP grew at an annualised 5.6 percent, beating a market forecast of 3.6 percent.
Ministry of Finance figures last week showed that capital spending by Japanese companies reached its highest in seven years in the quarter. The figures are used to compute revised GDP.
"An easing of worries about Wall Street's stability and oil prices is making investors increasingly confident about buying Japanese stocks given solid fundamentals," said Masayoshi Yano, senior manager of investment information Tokai Tokyo Securities.
"The Tokyo market caught a rising wave again. Stocks will continue rising for a while, reflecting a bright corporate earnings outlook and macroeconomic recovery."
Canon Inc <7751.T> edged up 0.52 percent to 5,760 yen, extending gains into a third straight day after the camera and copier maker said it would likely beat its earnings forecast for the quarter to June.
Fujitsu Ltd <6702.T> gained 1.17 percent to 781 yen, a level unseen since July 2002. Fujitsu and South Korea's Samsung SDI Co <006400.KS>, the world's top plasma display panel (PDP) makers, said on Monday they have agreed to drop lawsuits filed against each other for alleged patent infringements.
The Japanese and Korean companies also agreed to jointly use their patented PDP technologies over the next five years to help enlarge the market, Samsung SDI said.
Among other technology shares, Tokyo Electron Ltd <8035.T>, the world's second-biggest maker of chip manufacturing equipment, rose 1.59 percent to 6,370 yen, building on Monday's 5.03 percent rally.
Fourth-ranked bank UFJ Holdings Inc <8307.T> gained 0.91 percent to 557,000 yen, after rallying nearly seven percent on Monday on expectations of progress in its efforts to dispose of bad loans.
Other notable movers include Nippon Oil Corp <5001.T>, which climbed 3.15 percent to 655 yen, after Japan's largest oil distributor said on Tuesday it would refine 20,000 barrels per day of crude oil for state-run Chinese oil trader Chinaoil.
Chinaoil is a unit of China's largest oil and gas producer, PetroChina Co <0857.HK> . ((Reporting by Mariko Katsumura
