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Tokyo stocks open modestly higher

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(GlobalPost/GlobalPost)

Tokyo stocks opened modestly higher on Friday after the dollar soared against the yen on speculation that the US Federal Reserve could soon scale back its stimulus programme.

The benchmark Nikkei 225 index gained 0.46 percent, or 70.74 points, to 15,412.56 to in the first few minutes of trading.

Good US retail sales data raised speculation that the Fed will soon start reducing its easing efforts, while the Bank of Japan maintains its bold easing programme, said Hideyuki Ishiguro, senior strategist at investment strategy at Okasan Securities.

"Toward the next week, we'll likely to see the yen to weaken and stocks to rise amid speculation of easing reduction," he told Dow Jones Newswires.

A weak yen is good for Japanese exporters as it increases their competitiveness abroad.

The dollar rebounded Thursday as US bond yields turned higher on rising expectations of a Federal Reserve taper as its policy board meets next week.

Although many analysts said the move could be put off for another month, solid data on US retail sales for November added to the picture of a stronger US economy, raising the chances of an initial cutback to the $85 billion-a-month bond buying programme.

The dollar rose to 103.53 yen early Friday from 103.36 yen in New York Thursday afternoon and the mid-102 yen range in Tokyo Thursday.

The euro bought $1.3748 and 142.31 yen compared with $1.3752 and 142.15 yen in US trade.

US stocks Thursday closed lower with the Dow Jones Industrial Average falling 0.66 percent to 15,739.43.

bur-mis/mtp

http://www.globalpost.com/dispatch/news/afp/131212/tokyo-stocks-open-modestly-higher