Nikkei extends gains as Tokyo emergency triggers short covering

TOKYO, April 8 (Reuters) - Japanese shares gained on
Wednesday after Prime Minister Shinzo Abe ended market
uncertainty by declaring a long-awaited emergency, which led
investors to buy in shorted stocks of railway and department
store operators.
The Nikkei share average .N225 rose 0.47% to 19,039.91
while the broader Topix .TOPX gained 0.59% to 1,411.44,
extending the rally into its third day.
Besides short-covering after the declaration of emergency,
which will give authorities more power to press people to stay
at home and businesses to close, hopes of a slowdown in the
coronavirus-related deaths have also been propping up markets.
"Markets have known that it is coming and is welcoming the
move," said Hiroshi Masushima, market analyst at Monex
Securities.
With the number of cases increasing in the past couple of
weeks, many market players have anticipated and also called for
such a move.
Post declaration, short-term players swiftly bought back the
shares of companies they had sold heavily on expectations of
huge damages from the emergency.
Railway operators soared, boosting the Tokyo Stock
Exchange's land transport index .IRAIL.T 2.74%.
Tobu Railway 9001.T rose 5.2%, while Odakyu Electric
Railway 9007.T gained 4.0%. Keio Corp 9008.T rose 4.1% and
East Japan Railway Co 9020.T added 3.6%.
Department stores also bounced back even as they announced
store closures.
Takashimaya 8233.T , J.Front Retailing 3086.T and Isetan
Mitsukoshi 3099.T rose 4.5%, 4.2% and 3.8% respectively.
Some healthcare related shares also maintained their
recovery trend. M3 2413.T soared 8.7% to a record high, though
some analysts cautioned that it is now trading at more than 100
times its earnings.
Drugmakers also did well, with Chugai Pharmaceutical
4519.T gained 3.9%, while Daiichi Sankyo 4568.T added 3.7%.
Still, in a sign of overall wariness about an inevitable
sharp economic downturn due to the coronavirus pandemic,
decliners outnumbered gainers by a ratio of 5 to 3, despite
rises in the Nikkei and Topix.
SoftBank Group Corp 9984.T fell 1.7% after a WeWork board
committee that negotiated a $3 billion tender offer with
SoftBank sued the Japanese conglomerate on Tuesday for
abandoning the deal, accusing it of succumbing to "buyer's
remorse" amid the novel coronavirus outbreak.