Japanese Stocks Advance After Yen Weakens on Strong U.S. Data

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Japanese stocks rose, paring the Topix index’s first back-to-back weekly drop since January, after the yen weakened against the dollar as U.S. data boosted confidence in the strength of the world’s largest economy.

Murata Manufacturing Co. climbed 3.2 percent as a gauge of electronic goods makers provided the biggest boost to the Topix. Ihara Chemical Industry Co. dropped 5.7 percent after its second-quarter profit declined. Osaka Gas Co. and Electric Power Development Co. led power producers lower as the Nikkei newspaper reported that Environment Minister Yoshio Mochizuki opposed a planned venture between the two firms.

The Topix rose 0.1 percent to close at 1,651.48, dropping 0.9 percent this week. The Nikkei 225 Stock Average added 0.1 percent to 20,407.08. Both gauges swung between gains and losses on Friday after June futures contracts on the Nikkei 225 expired with a settlement price, known as the special quotation, of 20,473.83. The yen traded at 123.53 per dollar after falling 0.6 percent on Thursday.

“The good news for investors is that the U.S. economy is showing signs of life,” said Matthew Sherwood, head of investment markets research in Sydney at Perpetual Ltd., which manages about $21 billion. “Improving U.S. economic data was constructive for risk appetite, with retail sales for May expanding solidly.”

The Standard & Poor’s 500 Index rose 0.2 percent in New York on Thursday after data showed sales at retailers picked up in May and applications for unemployment benefits remained below 300,000 for a 14th straight week, a sign of labor market strength. E-mini futures on the S&P 500 slipped 0.2 percent.

The Japanese yen is weak, though still around an appropriate level to reflect Japan’s fundamentals, said Naoyuki Shinohara, a former top currency official at the finance ministry.

BOJ Governor

Shinohara’s view adds to comments on the currency this week from current and former Japanese policy makers. The yen posted its biggest one-day gain this year against the U.S. dollar on Wednesday when Bank of Japan Governor Haruhiko Kuroda said the real effective exchange rate was already weak and that it was hard to see it falling further.

The International Monetary Fund said its team negotiating with Greece left Brussels after failing to make progress on a debt deal. Meanwhile, European Union President Donald Tusk told Greece Prime Minister Alexis Tsipras to stop maneuvering and decide whether to accept the conditions on financial aid.

Tsipras has promised Germany and France that he will step up efforts to find a package of reforms and budget fixes before the country’s bailout agreement expires at the end of the month. Greece didn’t concede any ground on EU proposals at a two-hour meeting concluding after midnight, Bild reported.

In Tokyo, Osaka Gas lost 3.3 percent and Electric Power retreated 3.1 percent.

Among other rising shares, Minebea Co. gained 4.5 percent after Mitsubishi UFJ Morgan Stanley raised its share-price target on the motors maker.

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