Stocks wiped out earlier losses to end nearly flat on the Tokyo Stock Exchange Thursday, thanks to buying on dips.
The Nikkei rose 1.77 points, or 0.01 percent, to close at 19,939.90. On Wednesday, it fell 74.27 points.
The Topix ended up 0.68 point, or 0.04 percent, at 1,602.94, after gaining 0.31 point the previous day.
Stocks in Tokyo got off to a weaker start after the Dow Jones industrial average retreated Wednesday due to investor cautiousness about an interest rate hike by the U.S. Federal Reserve following remarks of Fed Chair Janet Yellen, brokers said. In a speech the same day, Yellen expressed her confidence in the strength of the U.S. economic recovery.
Stocks showed resilience by the middle of the morning session, pushing up the key indexes to plus territory. Still, they moved mostly weaker amid a growing wait-and-see mood ahead of the European Central Bank’s policy-setting meeting later on Thursday.
The market’s downside was limited, however, and the key market gauges wiped out the losses again toward the close.
Buying on dips on the back of hopes for further gains in stock prices toward the end of the year underpinned the market, brokers said.
“It was difficult for investors to activate trading ahead of the ECB meeting, as well as the release of U.S. jobs data” for November on Friday, said Nobuyuki Fujimoto, market analyst at SBI Securities Co.
On the other hand, investor appetite for buying on dips was strong as the supply-demand balance is expected to be favorable toward the year-end, Fujimoto said.
“If the ECB decides on additional monetary easing as expected, Tokyo stocks are likely to be boosted,” he added.
A majority of market participants now expect the ECB to ease its monetary policy further at the meeting, but if its asset purchase program is expanded to cover municipal bonds, it would be a positive surprise to the market, an official of a major securities firm said.
Despite the indices’ gains, falling issues outnumbered rising ones 974 to 785 in the TSE’s first section, while 162 issues were unchanged.
Volume shrank slightly to 1,863 million shares from Wednesday’s 1,898 million shares.
Automaker Toyota, banking groups Mitsubishi UFJ and Sumitomo Mitsui, and insurer Dai-ichi Life gained ground.
Industrial robot producer Fanuc, electronics parts maker Murata Manufacturing and mobile phone carrier KDDI were also on the plus side.
Japan Post Holdings attracted purchases as the company bought back own shares totaling 730 billion yen from the government on Thursday morning.
Oil company JX Holdings rose on a news report that Saudi Arabia will propose an oil production cut at a meeting of the Organization of the Petroleum Exporting Countries on Friday, brokers said.
By contrast, clothing store chain operator Fast Retailing met with selling after reporting sluggish sales at its Uniqlo outlets in November.
Other major lowers included mobile phone carrier Softbank Group, electronics maker Sony and power firm TEPCO.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average fell 10 points to finish at 19,940.
Source: http://www.japantimes.co.jp/news/2015/12/03/business/financial-markets/stocks-flat-tokyo-erasing-losses/#.VmBbZHYrLIU
