* Yen weakness likely to support market this week - analysts
* Securities, banking sectors in demand
* Isuzu, Nissan sag on disappointment over earnings
By Tomo Uetake
TOKYO, Feb 12 Japan's Nikkei share average
climbed 2.4 percent on Tuesday, boosted by financials and
exporters as the yen weakened after a U.S. Treasury official
voiced support for Japan's aggressive policies to combat
deflation and bolster growth.
The index rose to 11,422.77, within reach of a
33-month high of 11,498.42 struck last Wednesday. The benchmark
has risen nearly one-third since mid-November.
"The upward trend in Japanese stocks provided a tailwind to
the securities sector on hopes that the rallies would bolster
their commission income," said Yuya Tsuchida, a strategist at
"The Nikkei is expected to stay strong this week and may
reach 11,500 if the yen stays around current levels of around 94
yen to the dollar," Tsuchida said.
The securities sector, which jumped 5.3 percent,
was the best sectoral gainer on the main board, with Nomura
Holdings soaring 5.9 percent and Daiwa Securities Group
jumping 4.8 percent.
The banking sector was the third-best sectoral
performer, adding 3.2 percent, with Mizuho Financial Group Inc
and Sumitomo Mitsui Financial Group Inc rising
4.4 percent and 3.6 percent, respectively.
Japan's aggressive expansionary monetary policies have
sharply weakened the yen in recent months, prompting concerns in
Europe and the United States.
With finance ministers from the Group of 20 nations
scheduled to meet this week, investors betting on a weaker yen
were relieved after U.S. Treasury Undersecretary Lael Brainard
said Washington supports Japanese efforts to end deflation and
"Her comments gave confidence to the market. It was
surprising, and was taken as the Obama administration giving a
green light to 'Abenomics'," said Takuya Takahashi, a market
analyst at Daiwa Securities, adding that he expects the Nikkei
to remain strong this week.
The dollar touched a high of 94.42 yen on Monday, its
highest level since May 2010.
ISUZU, NISSAN UNDERPERFORM
Exporters gained ground, with Toyota Motor Corp
rising 2.8 percent, Sony Corp advancing 3.2 percent and
Canon Inc adding 2.8 percent.
However, Isuzu Motors Co Ltd shed 5.2 percent after
the automaker retained its operating profit and sales forecast
for the year ending March 31, disappointing investors who had
hoped that a weaker yen would boost overseas revenue, and
thereby profits, in the final quarter.
Nissan Motor Co also lost ground, falling 3.8
percent after it bucked the optimistic trend among other
Japanese carmakers reporting quarterly earnings, leaving its
annual profit forecast unchanged as sluggish sales weighed on
its bottom line.
The broader Topix gained 1.9 percent to 975.47 in
relatively active trade, with volume at 84 percent of its full
daily average for the past 90 trading days.
"Investors were worried that finance ministers would
criticise the recent weakness in the yen. While the currency
moves have been sensitive to officials' comments in general,
people thought any comment from G20 would trigger yen buying,"
said Hiroichi Nishi, an assistant general manager at SMBC Nikko
"But such worries are receding as she (Brainard) said she
supports Japan's efforts to end deflation."
European Central Bank council member Jens Weidmann also said
the euro was not overvalued at current levels.
Analysts said that concerns over the euro-zone economy,
which dented the market sharply on Friday, are receding for the
They added that the yen looks set to stay under pressure on
expectations that Abe will endorse a far more dovish Bank of
Japan regime when the current leadership's term ends next month.
The BOJ, which last month adopted a 2 percent inflation
target as a sign of its commitment to fight deflation and
announced a shift to "open-ended" asset buying, is expected to
refrain from taking fresh easing steps when it meets this week.