Tokyo's Nikkei stock index closes at 18-year high

GMT 08:34 2015 Wednesday ,24 June

Arab Today, arab today Tokyo's Nikkei stock index closes at 18-year high

Tokyo Stock Exchange
Tokyo - AFP

Japanese stocks closed at a more than 18-year high Wednesday, surpassing the height of the global IT bubble, boosted by confidence Greece will reach a last-minute debt reform deal with its creditors this week.

The benchmark Nikkei 225 index at the Tokyo Stock Exchange gained 0.28 percent, or 58.61 points, to 20,868.03, its highest finish since December 1996.

It rose to above the Japanese peak of the so-called dot-com bubble in April 2000 when the index hit 20,833.

The Topix index of all first-section issues was up 0.21 percent, or 3.49 points, at 1,679.89.

"Finally," Masaaki Yamaguchi, an equity market strategist at Nomura Holdings, told Bloomberg News. With the milestone out of the way, "we'll see an even higher tolerance for risk," he said.

The Tokyo bourse rose sharply in late 2012 as Prime Minister Shinzo Abe came to power and embarked on pro-public spending policies, sending the yen tumbling in a boost for Japanese exporters.

The Nikkei has climbed nearly 20 percent since the start of this year, following a rise of more than seven percent in 2014 and a 57 percent surge in 2013.

"The Japanese economy is improving and corporate earnings are doing well," SMBC Nikko Securities manager Hiroichi Nishi told Bloomberg News.

"As monetary policy in the United States moves towards normalisation, we'll have moderate rate hikes.

"We'll continue to have to watch the situation in Greece carefully, but within the wait-and-see mood there's increasing hope that they'll come to an agreement," he said.

Investors were betting on a breakthrough to end a five-month stalemate between Greece and its creditors, which would unlock billions of euros in funding Athens needs to repay a debt on June 30. Failure to do so will see it default and possibly crash out of the eurozone, and even the European Union.

Global markets have rallied this week after Greece handed over a set of reform proposals that met many of its creditors' demands.

Eurozone finance ministers are to meet Wednesday to try to secure an agreement before a full EU summit on Thursday.

"A relative lull in the Greek negotiations allowed the market to return its focus to relative monetary policy, where it seems the Fed will be one of the few central banks to be raising rates this year," Kymberly Martin, a senior markets strategist in Wellington at Bank of New Zealand, wrote in an email to clients.

The euro bought $1.1189 and 138.70 yen in Tokyo afternoon trade, down from $1.1393 and 139.95 yen in Asian trade on Tuesday.

In Tokyo share trading, financial issues were higher.

Japan's top brokerage Nomura Holdings jumped 1.27 percent to 842 yen and Sumitomo Mitsui Financial Group climbed 0.63 percent 5,522 yen.

Toyota was down 0.30 percent to 8,449 yen, following news that Japanese police had raided the car giant's headquarters over its American female executive's drug charges.

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