Nikkei jumps to 4-1/2-month high on Fed optimism; Toyota, Sony in demand

Wed Jun 18, 2014 9:57pm EDT

* Foreign investors place large buy orders on Japanese
stocks
    * Bellwether exporters soar on offshore demand
    * 32 of 33 sub-sectors in positive territory

    By Ayai Tomisawa
    TOKYO, June 19 (Reuters) - Japan's Nikkei share average
jumped 1.4 percent to a 4-1/2-month high on Thursday morning
after the U.S. Federal Reserve expressed confidence on its
economy and committed to its dovish monetary policy, which
spurred buying from foreign investors.
    The Nikkei rose 213.07 points to 15,328.87 in
mid-morning trade after climbing as high as 15,336.84, the
highest since January 29.
    Traders said that foreign investors placed a large amount of
buy orders on such bellwether stocks as Toyota Motor Corp
, which jumped 2.6 percent and was the second-most
traded stock by turnover. Honda Motor Co and Sony Corp
 surged 1.8 percent and 3.8 percent, respectively.
    "UK funds are buying Toyota and stocks like Nomura Holdings,
which have high short-sale ratios, are being bought as well,"
said a trader at a foreign brokerage.
    Nomura gained 1.7 percent and was the fifth-most
traded stock by turnover.
    The broader Topix soared 1.3 percent to 1,265.38,
with 32 of its 33 sub-sectors in positive territory.
    "Yesterday's Fed announcements include more than one good
news, so that's positive for Japanese market sentiment," said
Nobuhiko Kuramochi, a strategist at Mizuho Securities. "The Fed
sees the U.S. economy is on track, while it hinted of low
interest rates in the long term."
    The Fed expressed confidence the U.S. economic recovery was
on track and hinted at a slightly more aggressive pace of
interest rate increases starting next year, but suggested rates
in the long run would be lower than previously indicated.
 
    As widely expected, the Fed pushed ahead with plans to wind
down one of its main stimulus programmes, reducing its monthly
bond purchases to $35 billion from $45 billion.
    The JPX-Nikkei Index 400 gained 1.2 percent to
11,504.88.

 (Editing by Jacqueline Wong)
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