Japanese shares bounce back as earnings season picks up
13/07/2021 04:12
TOKYO, July 13 (Reuters) - Japanese stocks gained on Tuesday
with the broad Topix .TOPX index hitting a near one-month
high, after markets recovered from last week's sell-off awaiting
a slew of corporate earnings for a fresh readout on the
country's economic health.
Nikkei share average .N225 rose 0.78% to 28,792.06 while
the broader Topix .TOPX gained 0.77% to 1,968.45, briefly
touching its highest level since June 17.
Both indexes tumbled last week and many investors attributed
the slump to concerns about Delta variant as well as big selling
from Exchange Traded Funds (ETFs) related to their dividend
payment.
Most companies are expected to announce their quarterly
numbers in the coming weeks, making earnings the main focus of
the market.
A broad range of stocks gained, with all but three of the
Tokyo Stock Exchange's 33 industry sub-indexes trading in the
black.
Cyclical, value-oriented shares led the gains, including
shippers .ISHIP.T , securities brokerages .ISECU.T , and
insurers .IINSU.T .
Value-oriented shares .TOPXV outperformed with gains of
1%, compared with a 0.5% rise in growth shares .TOPXG .
"I am a bit cautious about the outlook, though. Growth
shares are expensive and it will take some time before their
earnings will catch up with expectations. On the other hand,
value shares have risen over the past seven months or so and
looking at the past their rally has not lasted longer than
that," Takenori Yamamoto, portfolio manager at Norinchukin
Zenkyoren Asset Management said.
Tama Home 1419.T gained 12.8% after the home builder
posted upbeat earnings due to stronger post-pandemic demand.
Kakuyasu 7686.T dropped 3.4% after the alcohol retailer
withdrew its earnings outlook for the current year through March
2022, citing uncertainties due to the government's renewed bans
on alcohol being served in restaurants.
(Reporting by Hideyuki Sano, Editing by Sherry Jacob-Phillips)
((hideyuki.sano@thomsonreuters.com; +81 3 4520 1195;))