Roundup: Japan's Nikkei ends higher on eased concerns over U.S. financial turmoil

0 Comment(s)Print E-mail Xinhua, March 17, 2023
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TOKYO, March 17 (Xinhua) -- Japan's benchmark Nikkei stock index closed higher Friday as concerns eased about turmoil in the U.S. banking system, and domestic banking and electronic shares found favor on improved sentiment.

The 225-issue Nikkei Stock Average added 323.18 points, or 1.20 percent, from Thursday to close the day at 27,333.79.

The broader Topix index, meanwhile, gained 22.32 points, or 1.15 percent, to finish at 1,959.42.

Local brokers said the market mood was brightened following reports a group of banks have put together a rescue package for First Republic Bank which has seen rapid deposit outflows since the collapse of technology-focused lender Silicon Valley Bank and Signature Bank, a big lender in the cryptocurrency sector.

The group comprised JPMorgan Chase & Co. and Goldman Sachs Group Inc., who jointly contributed 30 billion U.S. dollars to help prop up the at-risk lender, they highlighted.

"The rescue package from U.S. banks reassured the public's confidence in the banking system, causing a relief rally," CMC Markets analyst Tina Teng, was quoted as saying.

"The recent event suggests that central banks are most likely to temper their rate hikes, which could be a fundamental change to stock markets," she added, with reference to further monetary policy by central banks, following the European Central Bank on Thursday raising its rates by half a percentage point.

Meanwhile, concerns about contagion spreading to European banks abated somewhat, market strategists here said.

This was following Credit Suisse's stocks tanking on Wednesday owing to reports its top investor would discontinue investing in the Swiss bank due to fears the financial mayhem in the U.S. banking sector could spread to Europe, they explained.

The Swiss Bank announcing that it had found "material weakness" in some of its financial reporting in years past, added to contagion concerns, analysts also said.

However, Credit Suisse borrowing money from the Swiss Central Bank helped shore up its financial base and helped ease concerns about contagion in Europe, for now, market analysts said.

Among financial issues continuing to gain, Mizuho Financial Group Inc., was one of the day's biggest winners, jumping 3.5 percent, while technology issues also found favor.

These included chip-testing equipment maker Advantest gaining 3.3 percent, while chip-manufacturing equipment maker Tokyo Electron ended the day 2.9 percent higher.

By the close of play, precision instrument, air transportation and electric appliance issues comprised those that gained the most.

The turnover on the final trading day of the week came to 3,678.81 billion yen (27.64 billion U.S. dollars). Enditem

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