Nikkei gains but on track for worst month in 15 months
Japanese stock benchmark Nikkei gained on Tuesday as Wall Street stabilised and factory data from China held out the hope of a rebound in activity, even though the global coronavirus crisis showed no signs of abating.
The Nikkei share average rose 0.8% to 19,233.50 by the midday break. For the month, the index was down 9.0% and on track for its biggest monthly decline in 15 months. The benchmark was down 18.7% year-todate, set for its worst quarter since late 2008.
The Nikkei's volatility index, a measure of investors' volatility expectations based on option pricing and considered to be a fear gauge, shed 13.8% to 48.10, moving away from a nine-year peak of 60.86, hit on March 16. Market sentiment got a boost from Chinese factory activity data which unexpectedly expanded in March after contracting sharply to a record low in February.
China's official manufacturing purchasing managers' index (PMI) bounced to 52.0 in March, the National Bureau of Statistics (NBS) said on Tuesday, up from a record-low of 35.7 in February, and topping analysts' forecast of 45.0. The broader Topix added 0.3% to 1,439.67 by the midday recess, with oil and coal products sector leading the gain.
Major oil refiners JXTG Holdings Inc and Idemitsu Kosan Co Ltd rose 4.4% and 3.6%, respectively, after oil prices recovered some ground on Tuesday as the United
States and Russia agreed to discuss stabilising energy markets. As Tokyo was seen moving closer toward a potential citywide lockdown over the coronavirus pandemic, shares of remote work-related firms and gamemakers rose. Nintendo Co Ltd gained 3.1%, Square Enix Holdings Co Ltd rose 3.4%, and Capcom Co Ltd added 2.9%. Fujifilm Holdings Corp jumped 6.6% after the business daily Nikkei reported the company planned to increase production of its Avigan anti-flu drug, also known as favipiravir.
Fujifilm stocks climbed 6.0% on Monday after Prime Minister Shinzo Abe said the government would push for approval of the drug as a potential coronavirus treatment.