Tokyo stocks surge over 3% in morning after Japan-US tariff deal
The 225-issue Nikkei Stock Average rose 1,278.52 points, or 3.21 percent, from Tuesday to 41,053.44, after hitting a one-year intraday high. The broader Topix index was up 88.23 points, or 3.11 percent, at 2,924.42.
All industry sectors advanced on the top-tier Prime Market, with gainers led by transportation equipment, bank and pharmaceutical issues.
The U.S. dollar briefly weakened to the lower 146 yen range in Tokyo as the Japan-U.S. trade deal helped ease concerns over the prospects for the Japanese economy, boosting the yen.
At noon, the dollar fetched 146.93-94 yen compared with 146.62-72 yen in New York and 147.71-73 yen in Tokyo at 5 p.m. Tuesday.
The euro was quoted at $1.1734-1736 and 172.41-45 yen against $1.1750-1760 and 172.31-41 yen in New York and $1.1685-1687 and 172.61-65 yen in Tokyo late Tuesday afternoon.
Stocks climbed across the board, with auto shares surging after reports that the U.S. tariff on automobiles, imposed since April, will be cut to 15 percent from 27.5 percent for Japanese cars.
Among automakers, Toyota Motor ended the morning up 13.7 percent at 2,837.5 yen, while Mazda Motor surged 17.7 percent to 993.9 yen.
"Since the Japan-U.S. tariff negotiations had been expected to be prolonged, the market reacted positively as the trade deal was announced relatively soon after the national election" on Sunday, said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.
Despite the sharp advance, Ichikawa warned of the impact of a possible change in Japan's political situation on the market, with some expecting Prime Minister Shigeru Ishiba to resign after his ruling coalition suffered a major setback in the House of Councillors election.
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