Tokyo stocks close up 1.28 percent

TOKYO – Tokyo stocks rose 1.28 percent Monday on late bargain-hunting and thanks to a weaker yen following a big jump in the Bank of Japan’s quarterly business confidence survey.

The benchmark Nikkei 225 index closed up 175.18 points at 13,852.50, while the broader Topix index of all first-section shares gained 1.49 percent, or 16.86 points, to 1,150.70.

The Nikkei had ended the morning session lower after a weak manufacturing report out of China, but it bounced back as investors picked up cheap stocks.

“The market appears to be lacking a clear direction between weaker US shares on Friday and the strengthened dollar,” said Naoki Fujiwara, fund manager at Shinkin Asset Management.

On Friday, the Dow Jones Industrial Average tumbled 0.76 percent to 14,909.60.

Shortly before the opening bell Monday, the Bank of Japan reported sentiment among the country’s manufacturers improved sharply in the three months to the end of June.

The results of the bank’s Tankan survey come after earlier data including factory output pointed to a stronger Japanese economy as Prime Minister Shinzo Abe’s administration works to stoke growth with a policy blitz dubbed “Abenomics”.

“The Nikkei ended the morning in negative territory on profit-taking, but market sentiment still appears to be on course for gradual improvement,” said Katsuhiro Kondo, an analyst with Tokai Tokyo Securities.

“I think the Tokyo market has hit bottom,” Kondo said. “Players are going to adjust their positions higher while monitoring key economic indicators and major events, including upper house elections.”

Japan’s government said Friday the nation’s upper house elections would be held on July 21, with opinion polls tipping a big win for Abe’s party, clearing the way for him to push through much-needed economic reforms.

In Monday forex trading, the dollar rose to 99.54 yen against 99.11 yen in New York late Friday.

A weaker yen helps Japanese exporters by making them more competitive overseas and that tends to boost their shares.

In Tokyo stock trading, many exporters gained ground. Toyota rose 1.16 percent to 6,060 yen and Nissan increased 1.09 percent to 1,016 yen. Sony jumped 2.64 percent to 2,133 yen, with Canon up 0.15 percent at 3,240 yen.