Connect to share and comment

Tokyo shares up 0.91% by break

PlacardEnlarge
(Globalpost/GlobalPost)

Tokyo stocks rose 0.91 percent Thursday morning, but the upward momentum was pared by the Japanese prime minister's visit to a controversial war shrine.

The bellwether Nikkei 225 index gained 145.52 to 16,155.51 by the break after closing at a six-year high the previous day and backed by a weaker yen.

The Topix index of all first-section issues was up 1.54 percent, or 19.39 points, to 1,277.57.

Tokyo shares enjoyed a tailwind from the yen's weakening on the back of continued monetary easing steps by the Bank of Japan, said Yoshihiro Okumura, general manager of research at Chibagin Asset Management.

"The risk-taking sentiment is buoyant," Okumura told Dow Jones Newswires.

But the market showed a hint of caution as hawkish Prime Minister Shinzo Abe visited Tokyo's Yasukuni war shrine, which honours Japan's war dead, including several high-level officials executed for war crimes after World War II.

South Korea and China see it as a symbol of Tokyo's unrepentance and a misguided view of its own past.

The Nikkei pared earlier gains and the yen edged up after local media began reporting that Abe was headed to Yasukuni, raising fears that diplomatic tensions with Japan's key neighbours and trade partners could deteriorate further.

"There is a possibility that this would lead to another round of demonstrations (in China)," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

Japanese exporters suffered a serious consumer boycott in China last year after Tokyo nationalised some East China Sea islands also claimed by Beijing, setting off heated nationalistic sentiments in both nations.

Akino said he believed there was a relatively small risk of serious anti-Japan sentiment flaring up again in China.

However, Masaru Ishibashi, head of FX trading group at Sumitomo Mitsui Banking Corp., voiced caution.

"It would probably have been better if he didn't go," Ishibashi told Dow Jones Newswires of Abe's shrine visit.

"The United States would complain about this as well," he added.

bur-hih/mtp

http://www.globalpost.com/dispatch/news/afp/131226/tokyo-shares-091-break-0