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Tokyo stocks track Wall Street rally at open

WT24 Desk

TOKYO – Tokyo stocks opened sharply higher Monday following another record on Wall Street after traders welcomed strong US jobs data, AFP reports.

In the US, the broad-based S&P 500 and the tech-rich Nasdaq ended at all-time highs on Friday after Washington reported a big gain in jobs in July and upgraded employment estimates for the prior two months.

The world’s top economy added 255,000 jobs in July, the US Labor Department said, easily topping analyst forecasts for an increase of 185,000.

The strong report boosted the odds of a US interest rate hike by the end of the year, analysts said, lifting the dollar at the expensive of the Japanese yen and other major currencies.

The greenback rose to 101.99 yen from 101.79 yen in New York and 101.08 yen in Tokyo earlier Friday.
A weaker yen is a plus for the overseas profitability of exporters, boosting share-buying in those firms.

“A possible pullback in US jobs figures had kept some on guard, and the latest data have quenched those concerns,” Hitoshi Asaoka, a senior strategist with Mizuho Trust & Banking, told Bloomberg News.

“It does leave room for a rate increase within this year, but that will be offset by the impact on the yen, which will in turn support Japanese stocks.”

In opening deals, the benchmark Nikkei 225 index rallied 1.28 percent, or 207.84 points, to 16,462.29, after ending the previous session practically unchanged.

The broader Topix index of all first-section shares rose 1.23 percent, or 15.71 points, to 1,295.61.  In early Tokyo share trading, automakers jumped on the weaker yen, with Toyota, Nissan and Honda each rising about 1.7 percent.

Energy explorer Inpex tacked on more than two percent and crude refiner JX Holdings gained 0.7 percent.  On Wall Street on Friday, each of the major US indices rose about one percent including the Dow, which ended only 12 points away from a fresh record.

The S&P 500 gained 0.9 to 2,182.87 and the Nasdaq advanced 1.1 percent to close at 5,221.12.

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