TOKYO: Japan’s Nikkei share average reversed course to end higher on Monday, as investors scooped up equities on optimism that the nation’s largest pension fund GPIF may boost its holdings in stocks.
The Nikkei rose 0.8% to close at 38,513.02, after falling as much as 0.65% earlier in the session.
The Japanese government proposed to raise an investment return target for the Government Pension Investment Fund to 1.9% from 1.7%, paving the way for it to increase stock purchases.
“That raised optimism for stronger demand for stocks as GPIF may raise its weightings on Japanese stocks,” said Kentaro Hayashi, senior strategist at Daiwa Securities.
“Markets bet on the Nikkei index’s rise. So they bought back its heavyweight Fast Retailing.”
Uniqlo-owner Fast Retailing fell as much as 4.5% in early trade as it faced a storm of online criticism in China after a BBC report quoted the CEO saying that the company does not source cotton from the far western region of Xinjiang.
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