TOKYO: Tokyo stocks surged Tuesday, extending a global equities rally with a weaker yen lifting exporters as investors shrugged off failed talks to cut oil output.
Tokyo’s benchmark index had plunged 3.4 percent Monday as energy firms were hit by tumbling crude prices as a supply glut returned while worried traders rushed for safe-haven investments including the yen, putting pressure on exporters.
Two deadly earthquakes in southern Japan at the end of last week also forced major firms including Toyota and Sony to close factories, fuelling worries about their impact on the wider economy.
However, worries about crude eased later on Monday, and US and European markets ended in positive territory.
“The concerns we had yesterday were perhaps too extreme and didn’t spread to US markets,” Toshihiko Matsuno, chief strategist at SMBC Friend Securities, told Bloomberg News.
This “is leading to a sense of relief as oil prices recovered at the bottom”, Matsuno added.
The pick-up in optimism and hopes for fresh measures by the Bank of Japan following the double quake saw a move out of the yen.
In afternoon trade the dollar rose to 109.04 yen from 108.83 yen in New York, and well up from the levels below 108 yen seen in Tokyo earlier Monday.
