Tokyo stocks soar

Tokyo stocks closed 0.64 percent higher Tuesday, tracking a rise on Wall Street and with the weaker yen supporting exporters, while traders await congressional testimony by US Federal Reserve chief Janet Yellen. The Nikkei 225 index rose 98.34 points to finish at 15,395.16, while the Topix index of all first-section issues gained 0.65 percent, or 8.22 points, to 1,273.68.
Yellen kicks off two days of testimony later Tuesday, with traders hoping she will provide more detail on the bank's time-frame for raising interest rates following a string of upbeat data on the world's top economy. The Dow gained 0.66 percent on Monday, lifted by Citigroup's above-forecast earnings and a rash of merger and acquisition activity.
"The start of the US earnings reporting season is supplying a general sense of relief for equity investors, as Citigroup's numbers came in better than expected," said Naoki Fujiwara, fund manager at Shinkin Asset Management. "Solid earnings also help to mollify fears that share prices overseas may be overvalued," he told Dow Jones Newswires. "As Japan enters its own earnings reporting season, there could be a spillover effect that helps to nudge up price multiples, which still lag US and European bourses."
The Bank of Japan wound up a two-day board meeting Tuesday with policymakers holding fire on fresh easing measures. The decision was widely expected, but investors have been betting on the likelihood of further moves later this year, which would tend to weaken the yen and boost shares. Japan's economic growth slowed in the second quarter as an April sales tax hike hit spending, fuelling speculation the BoJ will eventually be forced to widen its monetary base.
In currency trading, the dollar edged up to 101.59 yen, from 101.54 yen in New York Monday afternoon. Financial shares were higher in Tokyo, with Japan's biggest bank Mitsubishi UFJ Financial Group rising 1.00 percent to 606 yen while rival Mizuho Financial Group added 0.50 percent to 201 yen. KDDI gained 0.41 percent to 6,316 yen after Kyodo News agency reported that the mobile carrier and trading house Sumitomo plan a cellphone joint venture in Myanmar with the state-run Myanma Posts and Telecommunications.