Tokyo fills up in the morning as Prime Minister Kishida delays capital gains tax hike

People walk past the electronic board of a securities firm in Tokyo on October 11, 2021. (AP Photo / Koji Sasahara)

TOKYO (Kyodo) – Tokyo shares rose on Monday morning as market sentiment improved after Prime Minister Fumio Kishida said at the weekend he would not immediately raise the tax rate on capital gains.

The 225-number Nikkei Stock Average climbed 440.01 points, or 1.57%, from Friday to 28,488.95. The larger Topix index of all First Section issues on the Tokyo Stock Exchange rose 27.66 points, or 1.41%, to 1,989.51.

The winners were led by issues of air transportation, mining and transportation equipment.

The US dollar climbed to 112 yen, its highest level since December 2018, extending late last week’s gains on rising US Treasury yields that fueled expectations of a larger interest rate spread. significant between the United States and Japan, brokers said. .

At noon, the dollar hit 112.54-55 yen against 112.17-27 yen in New York and 111.95-96 yen in Tokyo on Friday at 5 p.m.

The euro was listed at $ 1.1571-1571 and 130.21-25 yen against $ 1.1570-1580 and 129.85-95 yen in New York and $ 1.1547-1548 and 129.27-31 yen in Tokyo late Friday afternoon.

Shares were mixed early in the session, weighed down by declines on Wall Street late last week, but extended gains late in the morning on Kishida’s remark on a TV show on Sunday that he would not change the capital gains tax rate at the moment.

Kishida’s plan to raise capital gains tax and dividends from the current 20% fixed rate to implement his wealth redistribution policy was one of the market concerns that had triggered the recent cuts. consecutive Nikkei, brokers said.

“Mr. Kishida’s comment helped the market in part as his capital gains tax plan was seen as a selling factor,” said Toshikazu Horiuchi, equity strategist at IwaiCosmo Securities Co.

“Japanese stocks have been supported by a strong start in the Chinese market as well as optimism that China’s electricity shortage will be resolved after media reports that the country may increase coal imports,” a- he added.

Local media said the Chinese government has also ordered miners to increase coal production in Inner Mongolia, a major production site, to deal with the power shortage that could deal a severe blow to its economic recovery. .

On the Tokyo Commodity Exchange, Middle Eastern crude oil futures briefly eclipsed 54,500 yen per liter, hitting the highest level since October 2018, following advances in benchmark West crude futures. Texas Intermediate. The price of energy has recently climbed due to expectations of a tightening global supply.

On the first section, increasing emissions outnumbered declines from 1,670 to 420, while 87 ended the morning unchanged.

Major automakers were among the exporters, helped by the strength of the US dollar against the yen.

Toyota Motor gained 50.00 yen, or 2.6%, to 1,973.00 yen, Mitsubishi Motors jumped 15 yen, or 4.9%, to 319 yen and Honda Motor added 78 yen, or 2, 3%, to 3,448 yen.

The Sony Group climbed 465 yen, or 3.9 percent, to 12,325 yen.

The Japanese electronics conglomerate was flagged late last week as a potential partner with Taiwan Semiconductor Manufacturing Co. to build a chip manufacturing plant in Japan, a project for which the Japanese government plans to provide financial support.

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