Sumitomo Mitsui Financial Group Inc. (8316) climbed the most in more than four years in Tokyo trading, leading gains among Japanese lenders after the central bank announced its biggest round of quantitative easing.
The country’s second-biggest bank by market value jumped as much as 16 percent, the biggest intraday gain since October 2008, before trading 6.3 percent higher at 4,210 yen as of 9:53 a.m. in Tokyo. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s largest publicly traded bank, rose 5.2 percent and Mizuho Financial Group Inc. (8411) gained 3.4 percent.
The Nikkei 225 Stock Average (NKY) surpassed 13,000 for the first time since August 2008, a day after the Bank of Japan (8301) said it will double the monetary base by the end of 2014 to end more than a decade of deflation. Ten-year government bond yields tumbled to a record low, boosting the value of banks’ 164 trillion yen ($1.7 trillion) in holdings of sovereign debt.
“Expectations for inflation under the BOJ’s new policy would have a positive effect on bank lending,” said Shinichiro Nakamura, a Tokyo-based analyst at SMBC Nikko Securities Inc. “Monetary easing drives long-term interest rates lower and that’s good news for the banks’ bond trading profit.”
Sumitomo Mitsui Trust Holdings Inc., Japan’s fourth-biggest bank by market value, surged 16 percent. Shinsei Bank Ltd. advanced 15 percent.
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