Japanese share prices are set to rack up fresh gains next week after an end to the central bank's ultra-stimulative monetary policy swept away uncertainty dogging the market, analysts said on Friday.
Investors were heartened by the Bank of Japan's pledge this week to keep short-term interest rates effectively at zero percent for some time yet and to introduce a goal of keeping inflation between zero and two percent. For the week ending to March 10, the Tokyo Stock Exchange's benchmark Nikkei-225 index gained 452.29 points or 2.89 percent to 16,115.63.
The index jumped 2.6 percent Thursday after the BoJ announced its monetary policy shift and market sentiment remained upbeat through the rest of the week.
The broader TOPIX index of all first-section shares rose 34.31 points or 2.13 percent over the week to 1,647.27.
"The Bank of Japan's (BoJ) announcement and the settlement of the special future quotations are over, so foreign investors' appetite for buying will increase," said Kazuhiro Takahashi, equity general manager at Daiwa Securities SMBC.
He says the Nikkei key index is now set to test 16,500 points, with the release later this month of the Japanese government's annual report on national land prices another potential booster. "Shares such as real estate are expected to rise on expectations for land prices," Takahashi said.
Hiroyuki Nakai, chief strategist at Tokai Tokyo Research Centre, said that share prices are to rise gradually as investors look ahead to the land survey, the quarterly Tankan survey of business confidence in early April and the next corporate results season.
"Another key factor for the market is prospects for US interest rates," Nakai said, but added: "I don't expect that US interest rates will go up higher than 5.0 percent as the US economy is not strong enough," he said.
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