Nikkei up 0.4 pct on yen, but economy worry looms
Japan's Nikkei average rose 0.4 percent on Thursday, a day after closing at its lowest in nearly four months, as blue-chip exporters gained on the dollar's climb above 93 yen for the first time in six weeks.
Astellas Pharma rose after Nikko Citigroup raised its rating on the stock to buy/medium risk from hold/medium risk, saying the drugmaker's upwardly revised targets for the year to March were conservative and recommended it as a defensive stock.
The market largely brushed aside news from the Bank of Japan, which said it will extend the deadline for its buying of commercial paper to improve corporate funding. It kept its key policy rate unchanged at 0.10 percent by a unanimous decision.
Even though it will expand its measures the BOJ is basically maintaining its current policies, and that helps support the market, said Yutaka Miura, senior technical analyst at Shinko Securities.
The Nikkei gained 29.35 points to 7,563.79, poised to snap three days of losses in which it fell about 3 percent. On Wednesday the benchmark booked its lowest close since October 27.
The broader Topix rose 0.4 percent to 752.18 after ending the previous day a whisker away from its lowest close in 25 years.
Despite gains in the overall market, investors remained wary as the yen is coming under pressure due to worries about the Japanese economy and political uncertainty, with voter support for Prime Minister Taro Aso sinking.
The market seems to be depending only on buying based on what is undervalued and where it stands in terms of technical levels, said Tomomi Yamashita, a fund manager at Shinkin Asset Management.
A stronger dollar is positive for exporters, but that means the trend where money flows into the yen as the least unfavorable option is becoming less apparent. That is due to worries about political uncertainty and gross domestic product in Japan, putting domestic demand stocks under pressure.
The dollar rose above 93 yen on Wednesday after President Barack Obama pledged up to $275 billion to stem U.S. home mortgage foreclosures, but the move was not enough to calm Wall Street fears about the housing market and economy.
Exporters' shares gained as investors welcome a weaker yen, which boosts exporters' profits when repatriated. Toyota Motor Corp gained 2.9 percent to 3,150 yen and Honda Motor Co climbed 2 percent to 2,295. Sony Corp rose 1.6 percent to 1,627 yen.
Astellas shares added 1.8 percent to 3,330 yen.
(Reporting by Aiko Hayashi; Editing by Michael Watson)
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