Japan shares edge up as stimulus cheer lifts cyclicals, SoftBank drags

Japanese transport and materials stocks advanced

  
People are reflected on a glass in front of a large screen showing stock prices at the Tokyo Stock Exchange after market opens in Tokyo, Japan October 2, 2020.

People are reflected on a glass in front of a large screen showing stock prices at the Tokyo Stock Exchange after market opens in Tokyo, Japan October 2, 2020.

REUTERS/Kim Kyung-Hoon

TOKYO - Japanese shares inched higher on Monday as optimism around the passage of a massive U.S. stimulus package boosted cyclical stocks, although declines in SoftBank Group and other tech companies limited gains.

The Nikkei share average edged up 0.17% to close at 29,766.97, while the broader Topix gained 0.91% to close at 1,968.73,

"Today's market in Japan is a reflection of the U.S. market on Friday," said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.

The Dow Jones Industrial Average rose to its fifth consecutive record high on Friday as the U.S. House of Representatives gave final approval to the $1.9 trillion COVID-19 relief bill.

"Investors are buying cyclical shares that would benefit from a recovery of the U.S. economy, which would be accelerated by the huge economic package that was approved," Arisawa said.

Japanese transport and materials stocks advanced.

Ship builder Mitsui E&S Holdings jumped 7.78%, while shipping firms Kawasaki Kisen and Nippon Yusen rose 7.02% and 4.74%, respectively.

ANA Holdings jumped 4.43% and Japan Airlines advanced 3.79%.

E-commerce firm Rakuten surged 24% after announcing a capital tie-up with postal giant Japan Post Holdings, making it the biggest gainer in the Nikkei. Japan Post gained 2.49%.

Japan's tech shares fell tracking Nasdaq's decline on Friday, with Nikkei heavyweight SoftBank Group down 2.49%.

Tokyo Electron lost 1.56% and Advantest fell 1.26%.

Amid rising U.S. bond yields, Japan's largest banks gained the most among the top 30 core Topix names, with Mitsubishi UFJ Financial Group up 4.12%, followed by Sumitomo Mitsui Financial Group, which gained 3.55%.

The underperformers among the Topix 30 were SoftBank Group, followed by Nidec 6594.T losing 2.24%.

(Reporting by Junko Fujita; Editing by Devika Syamnath) ((813-4563-2711, junko.fujita@thomsonreuters.com, Reuters Messaging:junko.fujita.reuters.com@reuters.net;))


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