Nikkei ex­tends gains as panic sub­sides

The Pak Banker - - COMPANIES/BOSS -

TOKYO: Ja­pan's Nikkei share av­er­age ex­tended the pre­vi­ous day's gains on Thurs­day af­ter a strong re­bound on Wall Street and con­tin­ued calm in Chi­nese mar­kets eased in­vestors' fears of a pro­longed global mar­ket rout. Ex­pec­ta­tions that the U.S. Fed­eral Re­serve might not raise in­ter­est rates next month also aided sen­ti­ment.

The Nikkei rose 1.1 per­cent to 18,574.44, re­coup­ing some of the huge losses it suf­fered in the six-day los­ing streak that lasted through Tues­day. "The panic is start­ing to sub­side, so, in­stead of be­ing in­tensely fo­cused on China, peo­ple are start­ing to look more broadly at the in­ter­na­tional pic­ture," said Ni­cholas Smith, a strate­gist at CLSA. "And, the rest of the de­vel­oped world seems to be chug­ging along rea­son­ably well out­side of some prob­lems in com­modi­ties na­tions and emerg­ing mar­kets. North Amer­ica and Europe are do­ing just fine and that's what re­ally drives things as far as Ja­pan is con­cerned--the shop­ping malls of rich na­tions."

Mar­ket par­tic­i­pants said in­tense in­ter­na­tional fo­cus may over­shadow Fri­day's re­lease of data on Ja­pan's do­mes­tic un­em­ploy­ment, re­tail sales and house­hold spend­ing. "I think Fri­day's do­mes­tic num­bers will have a far less sig­nif­i­cant ef­fect on the mar­ket in Ja­pan than for­eign in­vestor per­cep­tion of Ja­panese com­pa­nies," said Martin King, co-man­ag­ing di­rec­tor of Ty­ton Cap­i­tal Ad­vis­ers in Tokyo.

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