* Yellen will have to continue communicating with market -
* Mining stocks drop hit by sliding oil prices
By Ayai Tomisawa
TOKYO, Dec 15 Japan's Nikkei share average rose
on Thursday morning as the dollar surged against the yen after
the U.S. Federal Reserve raised rates for the first time in a
year and signalled further hikes could come at a faster pace
than the market had expected.
The Nikkei rose 0.3 percent to 19,311.22 in
midmorning trade to hover at its one-year highs, while the Topix
rose 0.4 percent to 1,544.81 after turning positive on
the year earlier. In early trade, the Topix traded above
1,547.30, the closing price of the last trading day of 2015.
U.S. stocks fell overnight as the Fed's rate rise of 25
basis points to 0.5-0.75 percent was well flagged but investors
were spooked when the "dot plots" of Federal Open Market
Committee members' projections showed a median of three hikes
next year, up from two previously.
"Japanese stocks are rising because the weak yen is helping
overall sentiment. But in the longer term, investors expect that
the Fed will continue communicating with the market to ease
worries about negative risks," said Masaru Hamasaki, head of
market & investment information department at Amundi Japan.
The dollar surged more than 1.5 percent overnight to a
10-month high of 117.85 yen and was last at 117.64.
Exporters gained ground, with Toyota Motor Corp
rising 2.0 percent, Honda Motor Co adding 1.8 percent
and Advantest Corp advancing 1.9 percent.
Rie Shigekawa, a portfolio manager at Fidelity
International, said that after the Fed's decision, she expects
the yen to remain weak against the dollar and Japanese yields to
be pushed higher, despite the Bank of Japan's policy of
quantitative and qualitative monetary easing with yield curve
"I have increased my weight in financials, particularly via
the banks and insurance sectors, and global cyclicals, as once
we incorporate the current forex levels and monetary conditions,
their valuations become cheaper," she said.
Bucking the strength was the mining sector after oil prices
dropped as a hike in U.S. interest rates prompted a flood of
money away from commodities. Inpex Corp dropped 1.5
percent and Japan Petroleum Exploration Co tumbled 2.2
The JPX-Nikkei Index 400 gained 0.4 percent to
(Editing by Simon cameron-Moore)