Japanese shares track global peers higher, but virus woes cap gains

Tokyo Steel Manufacturing

26/07/2021 03:31

TOKYO, July 26 (Reuters) - Japanese shares rose on Monday,
as they caught the tailwind from a bounce in global peers on
positive corporate earnings, though gains were curbed by
investor concerns that a surge in domestic COVID-19 infections
could dampen economic recovery.
    Nikkei average  .N225  rose as much as 1.77% in early trade
after a four-day weekend that marked the opening of Tokyo
Olympics, before shedding a part of the gains to trade 1.30%
higher at 27,906.28.
    The broader Topix  .TOPX  was up 1.31% at 1,929.34, after
having risen 1.74% earlier in the session. During the long
weekend in Japan, all three major U.S. stock indexes closed at
record highs.
    "The market is strong during the U.S. and European trades.
As soon as Tokyo opens, it turns softer, which underscores the
cautious mood here. With coronavirus cases rising, investors
sell into rally rather than bidding up," said Tomoichiro Kubota,
senior market analyst at Matsui Securities.
    Tokyo reported 1,763 cases on Sunday, up 75% from a week
ago.  urn:newsml:reuters.com:*:nL4N2P107S
    Motor maker Nidec  6594.T  fell 1.1% after some investors
were disappointed by the firm not bumping up its annual profit
outlook despite the solid rise in quarterly profit.  urn:newsml:reuters.com:*:nL1N2OX0CW
    "The results were pretty good, but its share reaction
suggests shares that have very high investor expectations may
have hard time advancing gains," Matsui Securities' Kubota said.
    Elsewhere, Tokyo Steel Manufacturing  5423.T  jumped more
than 15% after the company boosted earnings forecast sharply.
 urn:newsml:reuters.com:*:nXB0MO3LAP
    That helped to boost other steelmakers' shares, with
industry leader Nippon Steel  5401.T  up 5.7% and JFE Holdings
 5411.T  rising 6.8%.
    Toray  3402.T  gained 5% after Nikkei business daily
reported that the chemical company's quarterly profits soared.
The firm will announce its earnings next week.
    SoftBank Group  9984.T  bucked the trend to fall 0.4%, hit
by worries about the firm's exposure to Didi  DIDI.N  and other
Chinese tech firms as China intensifies crackdown on them. 
 urn:newsml:reuters.com:*:nL4N2OY27V  urn:newsml:reuters.com:*:nL1N2OZ17U

 (Reporting by Hideyuki Sano, Editing by Sherry Jacob-Phillips)
 ((hideyuki.sano@thomsonreuters.com; +81 3 4520 1195;))