Nikkei rises to 15-year high on gains in financials, jump in Sony shares

Japanese stocks rose to a 15-year high on Thursday morning, helped by gains in financial and shipping companies, and as shares of Sony Corp jumped on a well-received business plan.

The Nikkei share average gained 0.5 per cent to 18,283.73 at the mid-day break after earlier rising to 18,322.50, its highest level since May 2000.

At mid-day, the value of trade on the Topix stood at 1.2 trillion yen, suggesting that daily value is heading for 3 trillion yen.

Market players said that a combination of factors have helped to underpin demand for Japanese stocks among foreign investors. These include news state-owned Japan Post Holdings' ditching of its conservative approach to investments with its US $5.1 billion takeover of Australia's Toll Holdings, and the Nikkei breaking new ground on its dollar-based value.

"US long-only (investors), who look at things on a dollar basis, say that the Nikkei is finally going into new ground," said a senior trader at a foreign brokerage. "Finally, we are broken out of a range we've been trading last year. The highest recently was $152.2, right now it's $154.2, so it's made that nice break out," the trader added.

Japan Post also said on Wednesday it would review its banking unit's $1.7 trillion asset portfolio, signalling a major shift in investment strategy at one of the world's biggest institutional investors.

Sony shares soared as much as 4.0 per cent to 3,300 yen in the Japanese market, the highest since April 2010 after saying that it aims to boost operating profit 25-fold within three years by growing its camera sensors and PlayStation units.

Banking shares were higher, with Mitsubishi UFJ Financial Group rising 2.5 per cent and Mizuho Financial Group up 2.7 per cent.

Shippers were also in demand. Mitsui OSK Lines added 0.9 per cent and Kawasaki Kisen gained 2.5 per cent.

Some analysts noted overbought technical signals in the market suggest near-term profit-taking could be possible.

The toraku ratio, or up-down ration, rose to 136.58 as of Wednesday. A level above 120 signals an overbought market. The ratio is calculated by dividing the 25-day moving average of stocks on the Tokyo Stock Exchange's first section that gained by the 25-day average of those that fell.

The broader Topix rose 0.6 per cent to 1,491.51, and

the JPX-Nikkei Index 400 gained 0.6 per cent to 13,530.62.

(Reuters)