TOKYO, Jan 20 (Reuters) - Japanese shares edged higher on
Monday, due to strong U.S. housing data and investor optimism
following last week's U.S.-China trade deal, though the market's
valuations are getting stretched.
The Nikkei share average .N225 rose 0.19% to 24,087.51,
staying near its 15-month high of 24,115.95 touched last week.
The broader Topix .TOPX gained 0.49% to 1,743.98 though trade
was slow due to a U.S. market holiday on Monday.
The gains came on the back of Wall Street's record close on
Friday after data showed U.S. homebuilding surged to a 13-year
high in December. The market was also underpinned by the signing of an interim
trade deal last week between the world's two largest economies.
"Considering that last year people were talking about the
possibility of trade talks breaking down, it is a huge relief
that we have had a deal," said Masahiro Ayukai, senior
investment strategist at Mitsubishi UFJ Morgan Stanley
Securities.
Given that the market has risen almost 20% since early
August even as Corporate Japan's profits outlook has hardly
improved, many investors are turning cautious.
The Topix is now trading more than 14 times above expected
earnings, compared with below 11 times at the start of last
year.
Chip-related shares were riding high, with optimism on the
industry getting another boost last week after Taiwan
Semiconductor Manufacturing Co Ltd (TSMC) forecast an up to 45%
spike in January-March revenue and raised its capex plan for the
year. Disco 6146.T rose 2.5%, Taiyo Yuden 6976.T added 1.9%
and Nidec 6594.T added 1.2%.
Telecom shares also advanced, with KDDI 9433.T rising 1.5%
to a 3-1/2-year high, while NTT 9432.T gained 0.5% to a
two-year peak.
Shares of Toshiba Corp 6501.T fell 4.6% after the company
found possible accounting irregularities at a wholly-owned
subsidiary, prompting it to revise past financial statements.
On the other hand, Toshiba Machine Co 6104.T soared as a
fund backed by veteran activist investor Yoshiaki Murakami
planned a takeover bid for the former Toshiba subsidiary firm.
Toshiba Corp now owns just over 2% of Toshiba Machine
shares.