Nikkei rebounds from 5-month low on China rate cut, game-maker rally boost



TOKYO, Jan 20 (Reuters) - Japan's Nikkei share average rebounded from a five-month low on Thursday, led by Sony and other video-game makers, after China ramped up its monetary easing measures to shore up a slowing economy by lowering a set of key policy rates.

The Nikkei .N225 ended up 1.11% at 27,772.93, extending the morning's gains in the afternoon. About three stocks gained for every one that fell.

The benchmark survived a sharp mid-morning dip, which pushed the index to its lowest intraday level since Aug. 23. China's surprise interest rate cut initially stoked fears of an economic slowdown, but investors were cheered by the rally in shares in the rest of the region, market participants said.

With the property downturn seen persisting into 2022 and fast-spreading Omicron variant dampening consumer activity, many analysts in China expect more easing measures will be necessary, despite other major economies appearing set to tighten their monetary policies.

On Wednesday, the Nikkei closed below 27,500 for the first time since Aug. 20, with Sony and Toyota Motor registering steep declines.

"The Nikkei has dropped to a level where it looks cheap, tempting investors to come in and buy the dip," said a market participant at a domestic securities firm.

Video-game maker Konami Holdings 9766.T rallied 6.20% to be the biggest percentage gainer in the Nikkei. Sony 6758.T added 5.84%, recovering from a nearly 13% slide hit in the previous session. Nintendo 7974.T rose 2.8%.

Toyota Motor 7203.T rose 1.72% following a 5% drop in the previous session. SoftBank Group 9984.T advanced 2.12%.

Retailers also gained, with department store operator Isetan Mitsukoshi Holdings 3099.T jumping 5.32%, while Uniqlo store operator Fast Retailing 9983.T advanced 1.73% to be Nikkei's biggest gainer by index points.

The broader Topix .TOPX rose 0.98%. The Topix growth share index .TOPXG jumped 1.35%, outpacing a 0.63% rise in the value index .TOPXV .

Japanese chipmakers, however, tracked their U.S. peers lower, with Tokyo Electron 8035.T sliding 0.45% and Advantest 6857.T dropping 1.57%, making it the biggest drag by index points.

Shippers were the biggest losers, with Kawasaki Kisen 9107.T tumbling 6.51% and Mitsui OSK Lines 9104.T shedding 5.26% to be the Nikkei's two biggest percentage decliners.
Reporting by Tokyo markets team; Editing by Sherry Jacob-Phillips and Uttaresh.V

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.