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Japan stocks reverse losses to end up 1% on stimulus hopes

Published 02/03/2020, 08:08
Updated 02/03/2020, 08:09
© Reuters.  Japan stocks reverse losses to end up 1% on stimulus hopes
JP225
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JNIV
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TOPX
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6506
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8035
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6758
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6857
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4755
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IFISH.T
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IRETL.T
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ISVCS.T
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MTHR
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TOKYO, March 2 (Reuters) - Japanese shares rebounded in

choppy trading on Monday, as investors pinned their hopes on a

coordinated monetary policy response from major central banks to

offset the hit to the global economy from a fast-spreading

coronavirus.

The benchmark Nikkei average .N225 finished 1% higher at

21,344.08 points, after five sessions of decline. It slid as

much as 1.5% to its lowest since Sept. 5 earlier in the day

before markets recouped after the Bank of Japan Governor

Haruhiko Kuroda pledged to take steps to stabilise markets.

The central bank will monitor the developments carefully and

offer sufficient liquidity via market operations and asset

purchases, Kuroda said in an emergency statement. On Friday, Federal Reserve Chairman Jerome Powell issued a

statement and said that the U.S. central bank was ready to

support the economy. The Nikkei's volatility index .JNIV , a measure of

investors' volatility expectations based on option pricing, rose

to a four-year high of 47.96, before dropping sharply to 38.7.

The broader Topix .TOPX ended up 1.0% at 1,525.87 as

Kuroda's statement helped to curtail the safe-haven yen's

earlier gains and provided a tailwind for broad-based Japanese

stocks.

About four-fifths of the 33 sector sub-indexes on the Tokyo

Stock Exchange were trading higher, with services .ISVCS.T ,

fish and forestry .IFISH.T and retailer .IRETL.T becoming

the top three performers.

The index of Mothers startup shares .MTHR rebounded 5.8%,

after plunging 6.3% to hit a fresh 4-year trough on Friday.

Cyclical stocks that suffered sharp falls on Friday

outperformed the overall markets, with semiconductor-related

Tokyo Electron Ltd 8035.T and Advantest Corp 6857.T climbing

4.5% and 5.0%, respectively, while Sony Corp 6758.T gained

4.0%.

Bucking the trend, Yaskawa Electric Corp 6506.T slipped

0.4% after surprisingly weak Chinese manufacturing activity

surveys pointed to slower growth in the world's second-largest

economy, a big market for the Japanese company.

The Caixin/Markit Manufacturing Purchasing Managers' Index

(PMI) tumbled to 40.3 in February, the lowest level since the

survey began in 2004, while China's official Purchasing

Managers' Index (PMI) fell to a record low of 35.7 last month.

Elsewhere, Rakuten Inc 4755.T dropped 1.3% as Japan's Fair

Trade Commission recommended a Tokyo court order the e-commerce

firm to halt the introduction of free shipping after the market

closed on Friday.

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