Japan's Nikkei climbs above 14,000 on solid U.S. data, softer yen

Mon Jul 1, 2013 9:12pm EDT

* Nikkei and Topix both rise 1.2 pct
    * Fast Retailing up, ahead of Uniqlo June same-store sales

    By Dominic Lau
    TOKYO, July 2 (Reuters) - The Nikkei share average climbed
above 14,000 points for the first time in nearly five weeks on
Tuesday as encouraging U.S. manufacturing and construction data
added to signs of an improving economy, which is Japan's biggest
export market.
    The Nikkei gained 1.2 percent to 14,020.56 by
midmorning, heading for a fourth straight day of gains - its
longest winning streak since mid-May, just before a sharp
sell-off that drive the index into bear market territory at one
point.
    "People are kind of taking off their downside strategies, so
that's helping the upside a little bit," a senior trader at a
foreign bank said, referring to derivative trades among hedge
funds.
    "People are kind of looking at things glass half full, glass
half empty in China and emerging markets."
    The strong U.S. data lifted the dollar to a four-week high
of 99.870 yen on Monday. The Japanese currency was last
traded at 99.605 to the greenback on Tuesday.
    Currency-sensitive exporters were in demand as the yen
weakened.
    Toyota Motor Corp rose 1.8 percent, and was the
second-most traded stock on the main board by turnover, while
Mazda Motor Corp and Honda Motor Co, were also
heavily traded, advancing 3.2 and 2.2 percent, respectively.
    U.S. manufacturing expanded last month, rebounding from an
unexpected contraction in May, but hiring in the sector was the
weakest in nearly four years, which could make the Federal
Reserve think twice about how soon to scale back its stimulus.
    A separate report also showed construction spending neared a
four-year high in May. 
    Other gainers in Tokyo included index heavyweight Fast
Retailing, up 0.9 percent, ahead of the monthly
same-store sales for its Uniqlo casual clothing chain in Japan.
    The broader Topix index rose 1.2 percent to 1,164.57
on Tuesday morning, with volume at 23 percent of its full daily
average for the past 90 trading days. 
    The benchmark Nikkei had fallen as much as 22 percent from a
5-1/2 year peak hit on May 23 on concerns over the Fed paring
its stimulus, a slowdown in China - Japan's second-largest
export market - and disappointment over Prime Minister Shinzo
Abe's growth strategy to revive the economy.
    But it has since rebounded from a two-month low reached on
June 13. 
    The Nikkei is up 13 percent since the Bank of Japan
announced radical monetary stimulus on April 4 and has risen 35
percent this year.
    As the market regained its confidence, real estate companies
, which have rallied hard until the sell-off in May,
were back on investors' radar, up 3.9 percent on Tuesday.
    The sector's 12-month forward price-to-book ratio slipped to
2.1 from a six-year high of 2.8 touched in mid-May, according to
Thomson Reuters Datastream. That compared with Japanese
equities' 1.1.