Stock Prices Close Higher in Tokyo

A key indicator of Tokyo stock prices rose Tuesday to a 20-month high as growing optimism about Japan’s economic prospects helped push real estate and banking issues higher. The U.S. dollar was lower against the Japanese yen.

The Nikkei Stock Average of 225 issues closed up 90.39 points, or 0.80 percent, at 11,361.51 points, its highest finish since closing at 11,449.44 on June, 11, 2002. On Monday, the index gained 229.20 points, or 2.08 percent.

The dollar was quoted at 109.38 yen by late afternoon Tuesday, up 0.15 yen from late Monday in Tokyo and also above the 109.05 yen it bought in New York. The dollar traded between 108.93 yen and 109.39 yen Tuesday in Tokyo.

On the stock market, investors snapped up issues sensitive to the domestic economy, following recent data suggesting the world’s second-largest economy may be on track toward a recovery.

Gross domestic product data released last week showed the economy expanded 1.7 percent in the October-December quarter, its fastest growth rate in 13 years.

In Tuesday’s trading, banks and real estate developers led the advance with UFJ Holdings, Mitsubishi Tokyo Financial Group, Sumitomo Realty and Mitsubishi Estate all ending higher.

Nippon Steel, Oji Paper and Tokyo Electric Power also rose.

“What’s really good for the market is that both (domestic) economy-sensitive issues and those dependent on external demand are being bought this time,” said Okasan Securities’ senior strategist Tetsuya Ishijima, saying he expected the market to be able to sustain its upward trend.

Technology blue chips ended mixed with Hitachi, NEC and Kyocera closing higher but Fujitsu fell. The yen’s recent decline was keeping many upbeat about the earning outlooks of such exporters, helping to support their stock prices.

The main index of all issues on the Tokyo Stock Exchange’s first section gained 9.15 points, or 0.83 percent, to 1,116.75. The index rose 25.13 points, or 2.32 percent, on Monday.

Volume on the first section was estimated at 1.6817 billion shares, up slightly from 1.6816 billion Monday. Advancers beat decliners 845 to 573, while 135 issues ended unchanged.

The euro bought $1.2398 late Tuesday in Tokyo, down from $1.2532 late Monday. Against the yen, the European currency was quoted at 135.60 yen, down from 136.88 yen.

The yield on Japan’s benchmark 10-year government bond rose to 1.3400 percent Tuesday from 1.2550 percent late Monday. Its price fell 0.74 to 99.65 points.

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