Nikkei Jumps to 4 - 1/2 - Month High on Fed Optimism ; Toyot

Bareksa.com - Japan's Nikkei share average jumped 1.4 percent to a 4-1/2-month high on Thursday morning after the U.S. Federal Reserve expressed confidence on its
economy and committed to its dovish monetary policy, which spurred buying from foreign investors.  

The Nikkei rose 213.07 points to 15,328.87 in mid-morning trade after climbing as high as 15,336.84, the highest since January 29.  

Traders said that foreign investors placed a large amount of buy orders on such bellwether stocks as Toyota Motor Corp, which jumped 2.6 percent and was the second-most traded stock by turnover. Honda Motor Co and Sony Corp  surged 1.8 percent and 3.8 percent, respectively.  

"UK funds are buying Toyota and stocks like Nomura Holdings, which have high short-sale ratios, are being bought as well," said a trader at a foreign brokerage.  

Nomura gained 1.7 percent and was the fifth-most traded stock by turnover.  

The broader Topix soared 1.3 percent to 1,265.38, with 32 of its 33 sub-sectors in positive territory. 

"Yesterday's Fed announcements include more than one good news, so that's positive for Japanese market sentiment," said Nobuhiko Kuramochi, a strategist at Mizuho Securities. "The Fed sees the U.S. economy is on track, while it hinted of low interest rates in the long term."  

The Fed expressed confidence the U.S. economic recovery was on track and hinted at a slightly more aggressive pace of interest rate increases starting next year, but suggested rates in the long run would be lower than previously indicated.

As widely expected, the Fed pushed ahead with plans to wind down one of its main stimulus programmes, reducing its monthly bond purchases to $35 billion from $45 billion.  

The JPX-Nikkei Index 400 gained 1.2 percent to 11,504.88. (Source : Reuters)