Nikkei seen hitting fresh 4-1/2 year high on strong US jobs data

Sun Mar 10, 2013 7:34pm EDT

TOKYO, March 11 (Reuters) - The Nikkei share average is
expected to rise on Monday following surprisingly strong U.S.
jobs data, with a weaker yen likely to fuel gains in exporters
and push the benchmark past the 4-1/2 year high it hit on
Friday.
    Market players said the Nikkei was likely to trade between
12,250 and 12,450 after Nikkei futures in Chicago 
closed at 12,345, up 1 percent from the close in Osaka 
of 12,220.
    The benchmark is also expected to rise sharply at the open
after foreign brokerages put in a net 31.5 million buy orders
for Japanese shares.
    U.S. indexes were at or near all-time highs after data
showed that 236,000 jobs were created in February, well above a
consensus expectation of 160,000, while unemployment dropped to
7.7 percent, the lowest since December 2008.  
    Signs of an authentic recovery in the U.S. labour market are
likely to bolster sentiment among investors in the Japanese
market, which is already riding a bullish streak on expectations
of aggressive easing by the Bank of Japan under incoming
governor Haruhiko Kuroda.
    Those expectations have helped the yen slide to 96 versus
the dollar - its weakest since August 2009 - boding well for
exporters' overseas earnings when repatriated.
    "The Topix's 12-month forward price-to-earnings ratio is now
13.3, which implies that investors are pricing in a 50 to 60
percent increase in profits for companies, based on the weaker
yen," said Masayuki Doshida, a senior market analyst at Rakuten
Securities.
    "However, that means Japanese shares are no longer looking
so cheap compared to U.S. or German stocks, which may blunt the
rally," he added.
    The Nikkei jumped 2.6 percent on Friday to 12,283.62, a
level not seen since early September 2008. That took it to its
biggest weekly gain since December 2011, of 5.8 percent.
    
> Wall St climbs on jobs, S&P up for 9th week out of 10     
> Dollar rallies across the board on US jobs data         
> Prices fall, yields jump on February job growth          
> Gold flat after U.S. payrolls, palladium up demand hope 
> Brent crude slips, high-priced RINs boost U.S. gasoline  
    STOCKS TO WATCH
    - SUMITOMO MITSUI TRUST HOLDINGS INC 
    Sumitomo Mitsui Trust, Japan's fifth-largest banking group,
said on Friday it will repay 200 billion yen ($2.1 billion) in
public bailout money, ending more than a decade of partial
government ownership. 
    - SHARP CORP 
    Hon Hai Precision Industry Co Ltd will not invest
in Sharp before a March 26 deadline after the two firms failed
to revise an earlier agreement, although the Taiwanese company
has not ruled out an investment altogether, the Asahi newspaper
said. 
    - MITSUBISHI HEAVY INDUSTRIES 
    Southern California Edison officials on Friday disputed
findings of a report from Mitsubishi Heavy Industries that
indicated both companies were aware of a design problem with
steam generator tubes now blamed for an extended shutdown of the
San Onofre nuclear station in California.
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.