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Nikkei hits 5-1/2-month high after U.S.-China talks show progress

Published 15/10/2019, 07:32
Updated 15/10/2019, 07:40
© Reuters.  Nikkei hits 5-1/2-month high after U.S.-China talks show progress

* Shippers, chip-related shares jump

* Constructors, home appliance makers rise after typhoon

damages

By Hideyuki Sano

TOKYO, Oct 15 (Reuters) - Japan's Nikkei share average rose

nearly 2% on Tuesday to its highest since late April, in a

delayed response to a potential U.S.-China trade deal outlined

by President Donald Trump last week.

Investors also bid up construction shares after Typhoon

Hagibis caused widespread damage in central and eastern Japan.

Reopening after a market holiday on Monday, the Nikkei

.N225 rose 1.87% to 22,207.21 points, its biggest daily gain

in more than a month.

The broader Topix .TOPX gained 1.56% to 1,620.20, near a

five-month closing high of 1,623.27 touched on Sept. 26.

Trump on Friday outlined the first phase of a deal to end a

trade war with China and suspended a threatened tariff hike, but

officials on both sides said much more work needed to be done

before an accord could be agreed. Shippers .ISHIP.T , sensitive to global demand and

developments in the U.S.-China trade war, jumped 2.9%, with

Kawasaki Kisen 9107.T rising 5.8% and Mitsui OSK Lines

9104.T 3.3%.

Semi-conductor related shares also soared.

Silicon wafer maker Sumco 3436.T rose 5.3%, while Shinetsu

Chemical 4063.T gained 2.6% to 20-month highs.

Screen Holdings 7735.T , maker of semiconductor

manufacturing machines, rose up to 3.5% to hit a one-year high.

Rohm 6963.T also scaled a year high and ended 4.5% higher.

Industrial robot manufacturer Fanuc 6954.T jumped 2.9%.

The construction sector .ICONS.T gained 2.4%. Kitano

Construction 1866.T , based in Nagano, one of the worst hit

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areas by the typhoon, rose 13.2%.

Household appliance makers were also helped by hopes of

fresh demand for goods such as refrigerators and washing

machines.

Hitachi 6501.T rose 2.7% while Panasonic 6752.T gained

2.2% despite damage to one of its factories. Suzuki Motor

7269.T , manufacturer of light automobiles, gained 4.4%.

SoftBank Group 9984.T climbed 2.5% after media reports

that SBG has prepared a financing package for WeWork Companies

Inc that would give it control over the shared office space

company Elsewhere, Ryohin Keikaku 7453.T , operator of "Muji" brand

stores, soared 8.3%, extending its rally after its June-Aug

earnings beat market expectations last week.

Insurers gained despite the damaging typhoon, with Tokio

Marine 8766.T up 2.1%, MS&AD 8725.T 2.4% and Sompo Japan

8630.T 2.1%.

Despite broad gains on Tuesday, many investors remained

cautious on the trade outlook due to a dearth of details on the

agreement between the United States and China.

"The market mood has changed but the trade situation hasn't

actually changed much," said Masayuki Doshida, senior market

analayst at Rakuten Securities.

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