April 10, 2013 / 1:25 AM / in 5 years

Nikkei rises as reflationary stocks lead gains after BOJ stimulus

* Investors caution against steep rise - fund
    * FamilyMart tumbles on poor forecast

    By Ayai Tomisawa
    TOKYO, April 10 (Reuters) - Japan's Nikkei share average
rose on Wednesday, moving closer to a near five-year high,
helped by ongoing optimism in the economic outlook since the
Bank of Japan started its sweeping monetary expansion campaign,
lifting real estate stocks and banks.
    Overnight gains on Wall Street also underpinned Japanese
equities, though gains may be capped in late trade with 
investors cautious of signs the market is overbought after the
Nikkei's sharp rise in the past week.
    The Nikkei gained 1.0 percent to 13,319.11 at
mid-morning trade, moving closer to an intraday high of
13,331.39  the previous day, its highest level since August
    The index currently trades 6.4 percent above its 25-day
moving average of 12,464.24. A level above 5 percent is
considered overbought.
    "The market has been gaining sharply, especially
reflationary stocks. The rises have been very, very steep," said
Yasuo Sakuma, portfolio manager of Bayview Asset Management,
adding he would not be surprised if investors wanted to lock in
some of their gains.
    Analysts said that although the mood remains positive, the 
rate at which the index climbs tends to slow when it trades
above 13,200.
    Asset-related stocks outperformed the market, with Mitsui
Fudosan Co rising 2.2 percent and Mitsubishi Estate Co
 gaining 2.8 percent.
    Banks also attracted buying, with Mitsubishi UFJ Financial
Group soaring 3.9 percent and Mizuho Financial Group
 gaining 2.8 percent.
    However, FamilyMart Co nosedived 7.9 percent after
the convenience store operator's worse-than-expected earnings
forecast for the year through February 2014 disappointed
    The broader Topix 1.5 percent to 1,118.43.
    The Nikkei has gained more than 5 percent since Thursday's
BOJ announcement of massive monetary stimulus. The central bank
plans to inject about $1.4 trillion into the economy in less
than two years by buying government bonds across the yield curve
as well as riskier exchange-traded funds (ETFs).
    The benchmark has surged more than 50 percent since
mid-November, when Shinzo Abe promised expansionist fiscal and
monetary policies, dubbed "Abenomics", to revive Japan's economy
during his election campaign. He was elected prime minister the
following month.
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