Stocks in Tokyo staged their biggest rally in 16 months on Monday as investors bargain-hunted despite lingering concerns about global growth that sparked volatility in markets last week.
In Tokyo, the Nikkei 225 ballooned 578.72 points, or 4%, to 15,111.23, after staggering 5% last week. The index had hit correction territory on Friday, having fallen more than 10% from a peak in late September.
The market also rallied on news that Japan’s Government Pension Investment Fund, the world’s largest public pension fund with some $1.21 trillion U.S. in assets, is working on raising its portfolio allocation devoted to domestic stocks to around 25%. There was a scramble to cover short positions, pushing shares higher.
The U.S. dollar rose strongly against the yen Monday. At the close of Tokyo trading, it was up more than a yen from Friday’s ¥106.22, helping Japanese exporters trying to price their goods competitively overseas. Among exporters sensitive to the yen, Toyota Motor Corp. rose 5.2% and TDK Corp. added 5.3%.
In Hong Kong, the Hang Seng index gained 47.05 points, or 0.2%, to 23,070.26, with talks set to begin between Hong Kong government officials and pro-democracy student protesters on Tuesday evening. Clashes between protesters and police escalated over the weekend but the mood appeared calm as markets opened Monday.
Investors also welcomed China’s central bank’s plan to inject $33 billion U.S. into the banking system.
Lifestyle International Holdings Ltd. was up 1.4%, after the chain, which owns Sogo department store in Hong Kong, agreed to sell 19.9% of its shares to Qatar’s sovereign fund.
CHINA
On the mainland, where the Communist Party is gathering in Beijing for an important planning meeting, Shanghai’s CSI 300 index recovered 12.98 points, or 0.5%, to 2,454.71
The week is an important one for China shares, with third quarter gross domestic product data to be released Tuesday. It is forecast to be up 7.2% from a year earlier, slowing from 7.5% growth in the second quarter.
The Shanghai benchmark index, having rallied since July, is up more than 11% this year.
The Hong Kong and Shanghai stock exchanges are also expected to launch a program allowing investors from both sides to access each other’s stocks, opening up a channel for fresh capital flows and potentially pushing up mainland shares.
In other markets;
The Taiex index in Taiwan bolted higher 150.26 points, or 1.8%, to 8,663.14
Korea’s Kospi index moved up 29.40 points, or 1.6%, to 1,930.06.
In Singapore, the Straits Times STI index gained 13.32 points, or 0.4%, to 3,182.05
In New Zealand, the NZX 50 picked up 50.94 points, or 1%, to 5,197.89
Australia’s S&P/ASX 200 added 47.72 points, or 0.9%, to 5,319.44
