Tokyo’s Nikkei index closes at 27-year high

A man walks past electronic boards showing Japan’s Nikkei average (L), the Dow Jones Industrial Average (2nd L) and foreign exchange rates outside a brokerage at a business district in Tokyo, Japan August 9, 2017. (AFP pic)

TOKYO: Tokyo’s benchmark Nikkei index rose to a 27-year high on Monday, boosted by a weak yen and a breakthrough in trade talks between the United States and Canada.

The Nikkei 225 index gained 0.52% or 125.72 points to close at 24,245.76 — the highest since November 1991 when Japan Inc was closing the final chapter of the nation’s speculative “bubble” economy.

“Reaching a 27-year high is symbolic but still a stop on the road to further gains,” Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP.

The Topix index edged up 0.04% or 0.71 points to 1,817.96.

The increases were driven in part by a rise in the yen to 113.95 yen in afternoon trade, from 113.67 yen late Friday in New York.

“The 113-yen level is definitely positive for Japanese exporters,” Hikaru Sato, senior technical analyst at Daiwa Securities, told AFP.

And analysts said a breakthrough in a trade deal renegotiation between Canada and the US also boosted the market.

The deal, which includes Mexico, came after more than a year of talks to revamp the North American Free Trade Agreement that President Donald Trump has labelled a disaster.

“While the market maintained its strong momentum, it would be no surprise to see investors cash in on the recent gains at any time,” Sato said.

Investors largely ignored a decline in business sentiment among large Japanese manufacturers announced by the Bank of Japan shortly before the market opened.

In Tokyo, Panasonic jumped 0.90% to 1,335.5 yen with Nintendo up 1.39% at 42,040 yen.

Automakers declined as investors locked in profits on last week’s jump following news that the US will not impose additional tariffs on Japanese-made cars.

Toyota lost 0.49% to 7,060 yen with Honda down 0.14% at 3,434 yen.