Nikkei rises to 4-1/2 year high as new BOJ leadership approved

Thu Mar 14, 2013 11:32pm EDT

* Shippers soar on expectation Japan to join TPP talks
    * Sony jumps on strong smartphone sales, Daiwa's upgrade
    * Parliament approves new leaders for BOJ

    By Ayai Tomisawa
    TOKYO, March 15 (Reuters) - The Nikkei share average rose to
a 4-1/2 year high on Friday on growing expectations the central
bank will ease monetary policy aggressively under its new
leadership.
    Japan's parliament approved Haruhiko Kuroda as the Bank of
Japan's next governor and Kikuo Iwata and Hiroshi Nakaso to
serve as the BOJ's two deputy governors. 
    "Approval by the upper house will boost hopes for more
decisive and swift policy easing," said Yoshiyuki Kondo, an
analyst at Daiwa Securities.
    Exporters, whose earnings will likely be boosted by a weaker
yen on hopes for bolder policy easing, were popular. Companies
such as warehouse owners and railroad operators with large land
holdings outperformed, helped by expectations that reflationary
policy will raise their asset values.
    The Nikkei gained 0.8 percent to 12,484.63 at the
midday break, after earlier reaching 12,502.81, the highest
level since early September 2008.
    Also lifting sentiment for stocks such as shippers was
Japan's expected participation in the Trans-Pacific Partnership
free trade negotiations. Media reports said that Prime Minister
Shinzo Abe plans to announce details later Friday.
    The marine transport sector was the best sectoral
performer, with Mitsui OSK Lines jumping 5.1 percent,
and Kawasaki Kisen Kaisha adding 5.0 percent.
    Among exporters, Toyota Motor Corp gained 1.2
percent, Honda Motor Co added 1.9 percent and Nikon
Corp climbed 2.2 percent.
     Sony Corp soared 6.9 percent and was the board's
most traded stock by turnover after Daiwa Securities raised its
rating to 'buy' from 'neutral,' saying that the company could
turn profitable in fiscal 2014 due to strong smartphone sales.
    The Nikkei said that the Xperia Z, a new smartphone model
Sony launched last month, was the top-selling model in Japan for
four straight weeks.
    Exporters have led the Nikkei's gains this year on Abe's
push to ease monetary policy and expand fiscal spending to pull
the country out of persistent deflation. The Nikkei has
outperformed its global peers, rising 20 percent this year
compared with the Dow Jones Industrial Average's  11
percent and the FTSEurofirst 300 index's 6.5 percent.
    "Investors have bought overall exporters for the past few
months. But they will be selective, and companies with
competitive advantages in the overseas market will likely rise
further from now such as automakers," said Masatoshi Sato,
senior strategist at Mizuho Securities.
     Sony attracted buying as the Xperia smartphone "seems to be
boosting sentiment in its shares," he said.
    Warehouse stocks rose on continuing expectations for the
government's reflationary policy, while Abe's likely decision to
participate in the TPP talks sparked hopes for higher storage
costs to handle imported products.
    Inui Warehouse Co increased 2.3 percent, Shibusawa
Warehouse Co gained 2.6 percent and Mitsui-Soko Co
 rose 2.2 percent.
    "Reflation stocks such as these warehouses and real estate
will probably continue to rise before the release of land prices
by the government next week. People started seeing office rents
in the Tokyo metropolitan area rising, and they want to see how
much land prices are rising as well," Daiwa's Kondo said.
    East Japan Railway Co added 1.1 percent, while
Odakyu Electric Railway Co gained 1.7 percent.
    Gains in U.S. and European stocks also bolstered investor
risk appetite, analysts said.
    "We see several signs of a little bit of overheating in the
Japanese market, but strength in the overseas market serves as a
tailwind to Japanese equities," said Hiroichi Nishi, an
assistant general manager at SMBC Nikko Securities.
    The Nikkei traded 6.5 percent above its 25-day moving
average. A level above 5 percent suggests that the market is
overbought.
    The Dow Jones industrial average ended at another record
high, helped by data showing U.S. jobless benefit claims fell.
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