Japanese Shares Rise to Four-Month High as Oil Prices Climb

  • Russia, Saudi Arabia said willing to cooperate on oil output
  • Apple suppliers defy Samsung Electronics slump to advance

Japanese shares rose to the highest level in four months, catching up on a global rally, as the yen extended declines and oil jumped.

The Topix index rose 0.4 percent, halving earlier gains, at the close in Tokyo. Stocks weathered a sell-off in Asian technology firms sparked by Samsung Electronics Co., as Japanese suppliers to Apple Inc. advanced. Stocks resumed trading after a holiday in Japan on Monday, when global equities rallied and oil advanced to the highest in more than a year
on optimism of a deal to limit output. The yen extended losses after the second U.S. presidential debate added to speculation Hillary Clinton will prevail over Donald Trump in the November election.

“The rise in oil prices and the weaker yen is having a large impact on Japanese shares,” said Mitsushige Akino, an executive officer at Ichiyoshi Investment Management Co. “With Clinton seen as taking the upper hand, we’re seeing more risk-on moves across markets. With oil prices higher, there’s more risk-taking.”

SecurityPercent ChangePrice
Topix+0.4%1,356.35
Nikkei 225+1%17,024.76
Yen-Dollar-0.4%104.05

Russia is willing to join Organization of the Petroleum Exporting Countries efforts to stabilize the market, requiring either a freeze or cut to current production levels, President Vladimir Putin said on Monday. Many producers outside the group have expressed a willingness to cooperate on output caps, said Saudi Arabia’s Energy and Industry Minister Khalid Al-Falih, adding that he was “optimistic” there’ll be a deal that could lift prices as high as $60 a barrel by the end of the year.

“With Russia strengthening the OPEC agreement we saw earlier, we can expect to see a further rise in oil prices,” said Takuya Takahashi, Tokyo-based senior strategist at Daiwa Securities. “A risk-taking attitude that stems from the U.S. is spreading globally, including in Japan.”

Meanwhile, Japan’s central bank still has room to increase monetary stimulus and doesn’t intend to reduce its bond-buying program soon, Governor Haruhiko Kuroda said in an interview with Bloomberg Television on Saturday.

Eleven shares rose for every seven that fell on the Topix, which climbed to the highest since June 1. An index of mining companies on the measure jumped 3.2 percent, the biggest advance among industry groups, while energy explorer Inpex Corp. was among the largest gainers on the Nikkei 225 Stock Average, climbing 3.2 percent. 

The Nikkei gained 1 percent, more than double that of the Topix, as SoftBank Group Corp., Fanuc Corp. and Fast Retailing Co. accounted for more than a third of the 165-point advance in the gauge. SoftBank rose 3.6 percent after the telecommunication services provider said that it will retire 8.3 percent of shares on Oct. 31.

  • Apple suppliers Alps Electric Co. and Murata Manufacturing Co. added 0.3 and 2.9 percent, respectively. Apple rival Samsung Electronics tumbled after telling carriers to halt sales and exchanges of its Galaxy Note 7 smartphone.

  • Takata Corp. sank 7.5 percent after people with knowledge of the matter said the embattled airbag producer hired law firm Weil Gotshal & Manges LLP to help it weigh options that could include bankruptcy or a sale. The company said it has made no decision on a Chapter 11 court protection filing for its U.S. unit.

  • Ono Pharmaceutical Co. tumbled 11 percent after data on its immune-system based cancer therapy drug Opdivo presented Sunday at the European Society for Medical Oncology meeting in Copenhagen showed it wasn’t superior to chemotherapy.

Japan’s August current account surplus was at 2 trillion yen ($19 billion), beating estimates of 1.5 trillion yen, according to Ministry of Finance data released in Tokyo Tuesday.

In the U.S., 156,000 workers were added to payrolls last month after a 167,000 increase in August that was more than previously estimated, according to data released Friday. Chances of an interest-rate increase at or before the Fed’s December meeting stood at 68 percent as of Monday, up from 64 percent on Thursday.

Futures on the S&P 500 Index declined 0.2 percent. The underlying equity gauge added 0.5 percent on Monday, led by energy and raw-materials producers, as the rally in crude bolstered optimism that the drag from weakness in oil will abate.

“I expect oil prices to be supported somewhat until the November end meeting,” said Hitoshi Asaoka, a strategist with Asset Management One Co. in Tokyo. The assessment that Clinton had the upper hand over Trump in their latest presidential debate “seems to have given a boost to the markets.”

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