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Nikkei set to rise after U.S. jobs data buoy Wall Street, dollar


TOKYO (Reuters) - Japan's Nikkei share average is expected to rise on Monday, likely helped by a weaker yen and upbeat U.S. jobs data that sent the dollar soaring and suggested the world's largest economy was on a solid footing.

Market players said the Nikkei <.N225> was likely to trade between 14,300 to 14,500 on Monday, and may attempt to scale fresh new 5-1/2-week heights.

"There are so many positive factors encouraging buyers," said Toshiyuki Kanayama, senior market analyst at Monex Inc. "But at the same time, there is a feeling of overheating in the market. So some profit-taking is quite likely."

On Friday, the benchmark Nikkei jumped 2.1 percent to 14,309.97, the highest closing level since May 29. The broader Topix <.TOPX> index gained 1.5 percent to 1,188.58.

Nikkei futures in Chicago closed at 14,420 on Friday, up 0.6 percent from the close in Osaka of 14,340.

Data on Friday showed U.S. jobs growth was better than expected in June and the two previous months of gains were revised higher, increasing the likelihood that the U.S. Federal Reserve will begin cutting its massive monetary stimulus, known as quantitative easing, as early as September.

The dollar posted broad gains, and U.S. stocks surged as equity investors were cheered by the strong economic momentum which offset some of the concerns over a reduction of the Fed's stimulus.

The yen hit a 5-1/2-week low of 101.47 yen to the dollar in early Asian trade on Monday.

The Nikkei is down 10 percents since reaching a 5-1/2-year high on May 23, hurt by slowing growth in China and concerns of an imminent rollback of the Fed's bond-buying program. However, it's still up 38 percent this year, underpinned by the Japanese government's sweeping stimulus policies.

(Reporting by Tomo Uetake; Editing by Shri Navaratnam)