Japan's Nikkei 225 Snaps Longest Losing Streak Since 2012 on Fed

  • Fed officials see higher burden to raising interest rates
  • Retailers tumble as Seven & I sinks ahead of earnings

Making Sense of What a Strong Yen Means to Markets

Japanese stocks rose, with the Nikkei 225 Stock Average snapping its longest string of losses since 2012, as rising crude oil prices boosted energy explorers and after Federal Reserve minutes showed officials won’t rush to raise U.S. interest rates.

The Nikkei 225 rose 0.2 percent to 15,749.84 at the close in Tokyo, snapping a seven-day losing streak that was the longest since Prime Minister Shinzo Abe won power in late 2012. The Topix index rose 0.4 percent to 1,272.64, reversing losses of 0.5 percent. The yen traded at 108.95 per dollar, its strongest level since October 2014. The Fed’s dovish stance, a weaker dollar, and a surge in oil triggered a rally in U.S. shares.

The Fed minutes “didn’t contain anything unexpected. There’s no rate hike in April and probably no hike in June either,” said Seiichiro Iwamoto, a senior fund manager at Mizuho Asset Management Co. in Tokyo. “It’s hard to say if the rise in Japanese stocks today marks the start of a trend. We’ve yet to see the yen move in a way that signals we’ll see a reversal of the downward bias.”

The dollar tumbled against the yen after minutes from the Fed’s March meeting showed officials debated the steady U.S. expansion against heightened global risks, and reached a broad agreement on a go-slow strategy that reduces the odds of a rate increase in the first half of the year.

Japan’s finance ministry said it was watching the yen’s surge and that it would take action if needed. Intervention was unlikely ahead of a Group of Seven summit the nation will host next month, according to Mitsushige Akino, executive officer at Ichiyoshi Asset Management Co. in Tokyo.

Energy Explorers

Energy explorers were among the biggest gainers, as crude oil rose for a third day. Inpex Corp. rose 2.8 percent, while JX Holdings Inc. added 2.9 percent.

Sosei Group Corp. spiked 21 percent, the most in more than three years, after Allergan Plc said it will pay $125 million upfront to the drugmaker’s unit for rights to a portfolio of treatments for neurological disorders including Alzheimer’s disease.

Online retailer Rakuten Inc. surged 7 percent after Amazon.com Inc.’s Japan unit said on Wednesday it would end free shipping on some orders. Takata Corp. slid 1.4 percent, falling for a fifth day and extending a record low, after U.S. regulators linked a new death to the company’s airbags.

A measure of retailers was the biggest drag on the Topix, led by Seven & I Holdings Co. which sank 1.6 percent. Shares pared losses of as much as 8.6 percent after the Nikkei reported its chairman and chief executive officer will step down, the latest move in an ongoing management saga at one of Japan’s largest retailers. After the close, the firm reported earnings that missed estimates.

Futures on the Standard & Poor’s 500 Index slipped less than 0.1 percent after the underlying gauge added 1.1 percent on Wednesday, the most in three weeks. An unexpected drop in crude stockpiles drove oil prices higher, while health-care shares rallied on speculation that following their busted deal, Pfizer Inc. and Allergan will turn their attention to other potential merger targets.

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