Tokyo stocks ended 0.64 percent higher on Tuesday, buoyed by a weaker yen and following another record finish on Wall Street. The benchmark Nikkei 225 index added 92.87 points to 14,599.12, while the Topix index of all first-section shares was up 0.71 percent, or 8.55 points, at 1,210.54. The gains, following a long weekend in Japan, were also helped by Chinese economic growth data that hit forecasts.
On Wall Street, the Dow rose 0.13 percent and the S&P 500 added 0.14 percent, both ending at their highest-ever levels despite disappointing US retail sales figures. Also in New York Monday the dollar rose to 99.85 yen, from around 99 yen on Friday. And the unit managed to hold on to those gains Tuesday in Tokyo, sitting at 99.85 yen in afternoon trade.
Investors were keeping an eye on polls in Japan Sunday that will see the election of half of the 242 seats in the upper house of the legislature. "The question on everyone's mind is whether the market will take off or sell off after the Sunday elections," said CLSA equity strategist Nicholas Smith. Media surveys have tipped Prime Minister Shinzo Abe's conservative Liberal Democratic Party (LDP) to win big, giving him control of both chambers and the ability to push a policy blitz consisting of huge government spending and monetary easing.
"A resounding LDP victory is already largely priced into the market, but the real issue is if Abe continues to immediately push his advantage or elects to rest on his beach towel for the summer recess," Smith told Dow Jones Newswires. In Tuesday trading, exporters were supported by the weaker yen with Canon up 2.67 percent at 3,460 yen and Toyota rising 0.78 percent to 6,460 yen. SoftBank, which closed a $21.6 billion deal to gain a controlling stake in number three US mobile carrier Sprint Nextel last week, climbed 2.60 percent to 5,910 yen.
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