Japan’s Nikkei hits one-week high as retailers soar

Financials continued to outperform following the Bank of Japan’s (BOJ) surprise decision last week to raise the policy ceiling for long-term yields.

The Nikkei share average ended the morning session up 0.52% at 26,543.47, after rising as high as 26,620.49 during the session.

The last time it had been at that level was Dec. 20, when BOJ raised the policy ceiling for long-term yields in an unexpected hawkish shift, triggering the Nikkei’s biggest tumble in more than two months.

Japanese stocks were already heavy from global recession worries as the Federal Reserve and European Central Bank aggressively raise rates.

The broader Topix added 0.62% to 1,914.40 on Tuesday, and touched a one-week high of 1,918.25.

“With global central banks tightening policy, concerns about an economic slowdown continue to be deep-rooted, and while the floor is firm for stocks, those worries will keep the topside heavy,” Maki Sawada, a strategist at Nomura, said on a conference call with the media.

Department store operator Takashimaya was the Nikkei’s best performer, surging 8.2%.

In addition to the lift from its revised earnings outlook, China’s decision to further ease COVID-19 restrictions stoked optimism for a boost to revenues from inbound tourism.

Department store chain Isetan Mitsukoshi Holdings was the second-best performer, climbing 7.8%. Cosmetics maker Shiseido was third, jumping 6.95%.

On the Topix, though, retailer Shimaura sank 3.01% after its earnings disappointed investors.

Retail was the second-best performer among Topix sectors, up 2.61%. The best performer was air travel, with Japan Airlines gaining 3.47%. Travel agency H.I.S. rose 2.04%.

The banking subsector added 1.42% to reach its highest level since February 2018.

This story has been published from a wire agency feed without modifications to the text.