September 13, 2019 / 6:52 AM / 7 days ago

Nikkei hits 4-month high on U.S.-China trade hopes, ECB stimulus

TOKYO, Sept 13 (Reuters) - Japan’s Nikkei share average rose to a fresh four month-high on Friday, as signs of thawing in U.S.-China trade tensions and the European Central Bank policy easing tempered worries about a global economic slowdown.

The benchmark Nikkei advanced 1.1% to 21,988.29, marking its highest close since May 7. For the week, the index advanced 3.7%, to post its biggest gain in eight months.

The broader Topix rose 0.9% to 1,609.87, its highest closing since April 26, with turnover on Tokyo’s main board stood at 3.34 trillion yen, the heaviest in nearly nine months.

On Wall Steet, the S&P 500 rose 0.3% to close within striking distance of its all-time closing high overnight, with investors sticking to hopes of more progress in upcoming trade talks between the world’s largest economies.

China and the United States both announced concessions this week ahead of upcoming trade talks in early October. U.S. President Donald Trump later told reporters he may consider an interim trade deal with Beijing.

“It looks like foreign investors are returning to Japanese stock market as part of the great rotation from bonds to stocks,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

About two thirds of the Tokyo Stock Exchange’s 33 subsectors were in positive territory, with the interest rate-sensitive real estate sector becoming the biggest gainer, up 2.7%, ahead of the U.S. Federal Reserve’s policy meeting next week.

Defensive shares were also in demand, with Shiseido and Tokyo Disney Resort operator OLC soaring 2.2% and 3.0%, respectively.

Panasonic gained 0.6% after the Nikkei newspaper reported Toyota Motor started using batteries that Panasonic designed for Tesla in some of its plug-in hybrids sold in China. Toyota added 0.8%.

Nissan Motor edged up 0.3% as the U.S. safety regulators opened a preliminary investigation into 553,000 Nissan Rogue sport utility vehicles after reports of their automatic emergency braking systems engaging without warning or an obstruction.

Elsewhere, Yahoo Japan jumped 4.9% after the internet company said it would take over online fashion retailer Zozo for 400 billion yen ($3.7 billion) on Thursday, seeking to compete better against the likes of Amazon.com. Zozo retreated 0.5%, paring some of its huge gains of 13.4% made the previous day.

$1 = 108.1400 yen Reporting by Tomo Uetake; Editing by Jacqueline Wong and Sam Holmes

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