Tokyo shares open higher as yen heads south

Tokyo, June 7 (AFP/APP): Tokyo shares opened higher Tuesday as the yen trended lower, offering tailwind to exporters, while investors eyed rising US yields.

Tokyo shares opened higher Tuesday as the yen trended lower, offering tailwind to exporters, while investors eyed rising US yields.

The benchmark Nikkei 225 index added 0.19 percent, or 53.35 points, to 27,969.24 in morning trade, while the broader Topix index rose 0.56 percent, or 10.79 points, to 1,949.90.

Wall Street shares firmed overnight, giving a boost to the Tokyo market, although the rise of US Treasury yields continued to weigh on share prices.

The dollar stood at a fresh 20-year high of 132.19 yen, keeping its momentum from New York, where it fetched 131.88 yen.

A stronger dollar and a lower yen generally supports Japan’s exporters by making their products more competitive overseas.

“The Tokyo market is expected to forge upwards on the back of US market gains and the yen’s depreciation,” Okasan Online Securities said.

“The yen’s fall can be concerning, as it means extra burden on consumers and businesses by increasing the cost of imported goods. But for the stock market today, investors should look to the benefits,” the brokerage said.

Globally, investors are shifting their focus to a US inflation report due on Friday to gauge the tone and speed of future actions Fed policymakers may take, analysts said.

“Wall Street will need to wait for a couple more inflation reports after this one before anyone can confidently make a call as to when the Fed may alter their tightening course,” said Edward Moya, senior market analyst at Oanda.

Market players also hailed news that China is easing some Covid-19 restrictions and that Chinese authorities are reportedly concluding a probe into ride-hailing giant Didi, around a year after it was hit by a sweeping tech clampdown.

Nintendo rose 0.85 percent to 58,320 yen and Sony Group edged up 0.12 percent to 12,090 yen. Toyota added 1.18 percent to 2,188.5 yen.
Energy company ENEOS Holdings added 0.36 percent to 563.5 yen. SoftBank Group added 1.60 percent to 5,477 yen.

But Advantest, which makes testing kits for semiconductors, dropped 3.05 percent to 8,900 yen. Uniqlo-operator Fast Retailing fell 0.76 percent to 68,180 yen.