Nikkei soars 4 pct on United States stocks rise, Abe's victory boosts confidence

Nikkei soars 4 pct on United States stocks rise, Abe's victory boosts confidence

Abe had repeatedly stressed during his campaign that his "Abenomics" program, centered on easy lending and a cheap yen to encourage exports, is still unfinished, and that patience is needed for results.

In Japan, the Nikkei 225 soared 601.84 points, or 4%, to 15,106.98, gains that came as the yen relatively weakened against the US dollar, trading at 101.88, compared with the dollar earlier fetching as little as 100.42 yen.

Japan's ruling coalition rang up a stronger-than-expected victory in Upper House elections, as voters chose stability despite concerns about Abe's economic policies and plans to revise the post-war pacifists constitution for the first time.

United States of America job creation in June was much stronger than expected, increasing by 287,000 and easing fears that the labour market may be faltering. Industrial production fell a seasonally adjusted 0.6 percent month-over-month in May, defying economists' expectations for a 0.1 percent rise.

"Investors are basically welcoming the victory of (Prime Minister Shinzo) Abe's ruling coalition", Daisuke Uno, chief market strategist of Sumitomo Mitsui Banking, told AFP.

Sterling was stuck at $1.2948 on Monday, having failed utterly to rebound from the 13 percent loss suffered in the immediate wake of Brexit.

The benchmark Nikkei 225 index finished the session up 3.98% at 15,708.82, recording its largest one-day percentage increase since February 15. Against the dollar GBPUSD, +0.5924% the pound strengthened to $1.3067 from $1.2999 while the euro EURUSD, +0.1809% to $1.1080 from $1.1058.

"Risk-taking sentiment has taken hold this week", he said.

The yen tumbled because "the Bank of Japan is likely to add to the macroeconomic stimulus package by easing monetary policy along with a more supportive fiscal environment", said Mr Mark McCormick, North American head of foreign-exchange strategy at Toronto-Dominion Bank. That matched forecasts and was unchanged from the May reading. Industrials .SPLRCI and consumer staples .SPLRCS also hit record highs.

The Labour Department said 287,000 jobs were created in June, 112,000 more than expected and a sharp improvement on May's 11,000 that had raised fears of a possible recession. The S&P 500 .SPX ended up 7.26 points, or 0.34 percent, at 2,137.16.

The major European markets also showed notable moves to the upside on Friday. The Shanghai Composite Index in mainland China advanced 1.8 percent to 3,049.38 and Australia's S&P/ASX 200 rose 0.3 percent to 5,353.20.

The rebound came after news the USA economy added 287,000 jobs last month, well above median forecasts and recovering ground after a very weak May report.

The kiwi fell against the greenback, trading at 72.19 U.S. cents at 8am in Wellington from 72.78 cents as it retraced recent gains.

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