* Benchmark JGB steady, superlongs slip
* Exporters stay firm as yen falls to lowest since May 2009
* Shares in real estate firms weak as investors cash in
By Dominic Lau and Lisa Twaronite
TOKYO, April 9 Japan's Nikkei average rose to
its highest level in nearly five years for a third straight day
on Tuesday as investors continued to plow money into equities
after the central bank lost no time in kickstarting bold
stimulus steps announced last week.
Benchmark Japanese government debt prices were steady,
although superlong bonds slipped ahead of a 30-year sale later
"It's still a quantitative easing market," said a senior
equity trader at a foreign brokerage in Tokyo. "There is some
profit taking after some of the big moves yesterday ... Small
real estate stocks are still getting up there."
The real estate sector, which is seen as the
biggest beneficiary of Japan's push to reflate the economy, lost
2.2 percent after rallying more than 26 percent in the previous
Within the sector, real estate investment fund Kenedix Inc
jumped 12.5 percent and was the most-traded stocks on
the main board by turnover.
By the midday break, the Nikkei advanced 0.5 percent
to 13,260.04 after trading as high as 13,331.39, its highest
level since August 2008. It was on track for a fifth straight
day of gains.
Financial firms, another sector expected to do well,
continued to attract buyers, with Nomura Holdings,
Japan's top brokerage, up 1.4 percent and consumer financing
firm Aiful Corp, the second-most traded stock, adding
The Bank of Japan promises to inject $1.4 trillion into the
world's third-largest economy in less than two years buy buying
government bonds across the yield curve as well as riskier
The BOJ on Monday launched its campaign by offering to buy 1
trillion yen ($10.3 billion) of JGBs with maturities of between
five and 10 years, and 200 billion yen of bonds with maturities
exceeding 10 years.
The extraordinary measures, which is aimed at ending nearly
two decades of deflation and economic malaise, has triggered a
wave of buying in Japanese equities.
The benchmark Nikkei has surged 53 percent since
mid-November, when Shinzo Abe promised expansionist fiscal and
monetary policies, dubbed "Abenomics", to revive the world's
third-largest economy during his election campaign. He was
elected prime minister the following month.
Japanese government bond prices were mixed. The 10-year
yield was unchanged at 0.520 percent, holding
well above a record low of 0.315 percent hit the day after the
BOJ's policy announcement.
Ten-year JGB futures ended morning trade up 0.28
point at 144.62, below their all time record high of 146.41
marked on Friday but also well off a 10-month low of 143.10 hit
during that volatile session.
Longer maturities underperformed, with some investors eyeing
Thursday's 30-year auction as the first test of real demand in
the new market order forged by the central bank's radical
"We are still getting used to a market in which the central
bank is the main player, so it's hard to predict how the auction
will go," said a fixed-income fund manager at a Japanese trust
The 20-year yield added 6.5 basis points to
1.290 percent, while the 30-year yield rose 6
basis points to 1.375 percent.
MUCH IN PRICE?
Andrew Pease, chief investment strategist for Asia-Pacific
at Russell Investments, said the stock market had already priced
in a strong rise in company earnings this year.
"If you look at the price-to-book value, which is still
below 1.5 times, you know Japan still has got some long-term
value," Pease said.
"It's still probably OK, particularly to the extent that you
know they are going to push the yen down. But most of the
reflation rally, I would say, already happened."
Exporters were buoyed by a softer yen, which fell as
much as 0.3 percent on Tuesday to 99.67 to the dollar, its
lowest level since May 2009.
Canon Inc, TDK Corp, Suzuki Motor Corp
and Olympus Corp rose between 2.1 and 3.2
Societe Generale highlighted a number of exporters, which it
said are "super sensitive" to yen depreciation, including Ricoh
Co Ltd, Olympus, Mitsubishi Heavy Industries Ltd
, Honda Motor Co and Canon.