March 8, 2013 / 1:55 AM / in 5 years

Nikkei vaults to new 4-1/2 year high on overseas lead

* Nakayama Steel soars on reports about subsidiaries
    * Sekisui House shoots up on profit forecast
    * Market "not overheated"- analyst

    By Sophie Knight
    TOKYO, March 8 (Reuters) - Japan's Nikkei share average
stormed to a fresh 53-month high in mid-morning trade on Friday,
buoyed by bullish data from the United States and continued
optimism for more aggressive easing from the new Bank of Japan
    The Nikkei advanced 1.4 percent to 12,137.56, its
highest level since September 2008. It also sailed past the
settlement price of a slew of options and futures that expired
on Friday morning at 12,072.98, according to market sources. 
    "I get the feeling there's a lot of basket-buying going on.
When the futures go up that pulls up the whole market," said
Fumiyuki Nakanishi, general manager of investment and research
at SMBC Friend Securities.
    Investors were bullish after the BOJ raised its outlook,
saying Japan's economy was "bottoming out" at the last meeting
chaired by governor Masaaki Shirakawa before successor Haruhiko
Kuroda, who is expected to implement aggressive easing, takes
his place.  
    Bearing out analysts' predictions of a boost to real estate
from such easing, Sekisui House Ltd said it expects
operating profit for the year ending January 2014 to jump 28
percent due to increases in rental agreements and new-builds.
Its share price shot up 12.7 percent.
    Nakayama Steel Works Ltd also saw strong gains, soaring 17.5
percent after the Nikkei business daily said the electric
furnace steelmaker was to turn five group companies into wholly
owned subsidiaries as part of its restructuring plan. 
    Expectations of easing helped the yen slip to 95.1 against
the dollar overnight, given an extra nudge by strong U.S.
jobless claims data that ramped up expectations for the nonfarm
payroll data out later on Friday.
    Analysts say foreign investors continue to pile into
large-cap exporters as the yen stays soft, while retail
investors are buying up smaller domestic-focused companies.
    "I don't get the feeling that the market is overheated at
the moment. The Nikkei is only about 5 percent above its 25-day
moving average, but it was hovering 9 percent above it in
January," Nakanishi of SMBC Friend Securities said.
    The only losers, Nakanishi added, were likely to be those
shares of companies hurt by a soft yen. The weakest sectoral
performer on Friday morning was the electric and gas sub-index
, which dropped 1.5 percent. 
    The broader Topix added 0.9 percent to 1,013.20 by
    Index heavyweight and operator of the Uniqlo clothing
storres Fast Retailing Co Ltd was the most-traded stock
on the main board, giving 30 positive points to the Nikkei and
leaving it 16 percent up on the week after strong February sales
were announced on Monday. 
    But convenience stores were weak, with FamilyMart Co Ltd
 dropping 2 percent after the Nikkei business daily said
its operating profit for the year ended Feb. 28 was likely to
come in below its prevously projected 45 billion yen, partly due
to a drop in cigarette sales. 
    Competitor Lawson Inc also ran against the market,
losing 0.6 percent.
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