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Japanese Market Rises

The Japanese stock market is rising on Monday following the gains on Wall Street Friday amid optimism global central banks will provide stimulus to prevent a global recession. Investors digested data showing that Japan's trade deficit in July missed expectations.

The benchmark Nikkei 225 Index is adding 137.55 points or 0.67 percent to 20,556.36, after touching a high of 20,633.90 in early trades. Japanese shares closed largely unchanged in cautious trading on Friday.

The major exporters are mixed despite a weaker yen. Sony is adding 0.6 percent and Mitsubishi Electric is rising 0.3 percent, while Canon is down 0.7 percent and Panasonic is lower by 0.4 percent.

In the tech space, Advantest is rising 0.4 percent and Tokyo Electron is advancing almost 1 percent.

Market heavyweight SoftBank is higher by more than 1 percent and Fast Retailing is up 0.5 percent. In the auto sector, Honda Motor is rising 0.4 percent and Toyota Motor is advancing 0.7 percent.

Among oil stocks, Japan Petroleum is declining more than 1 percent, while Inpex is higher by almost 1 percent after crude oil prices rose on Friday.

Among the other major gainers, FamilyMart UNY is rising more than 8 percent, while Sumco Corp., JGC Corp. and IHI Corp. are higher by almost 4 percent each.

On the flip side, Recruit Holdings is losing more than 3 percent and Nippon Express is lower by almost 3 percent.

On the economic front, the Ministry of Finance said that Japan posted a merchandise trade deficit of 249.6 billion yen in July. That missed expectations for a shortfall of 194.5 billion yen, following the 589.5 billion yen deficit in June.

Exports were down 1.6 percent on year, topping forecasts for a decline of 2.3 percent following the upwardly revised 6.6 percent drop in the previous month. Imports dipped an annual 1.2 percent versus forecasts for a decline of 2.3 percent following the 5.2 percent fall a month earlier.

In the currency market, the U.S. dollar is trading in the lower 106 yen-range on Monday.

On Wall Street, stocks closed sharply higher on Friday, partly reflecting optimism about the world's central banks providing aggressive stimulus in order to prevent a global recession. European Central Bank official Olli Rehn helped inspire confidence after expressing the need for a significant easing package in September to support the flagging eurozone economy. The expectations for more stimulus contributed to a pullback by U.S. treasuries and a subsequent increase in bond yields.

The Dow jumped 306.62 points or 1.2 percent to 25,886.01, the Nasdaq soared 129.38 points or 1.7 percent to 7,895.99 and the S&P 500 surged up 41.08 points or 1.4 percent to 2,888.68.

The major European markets also moved to the upside on Friday. While the U.K.'s FTSE 100 Index climbed by 0.7 percent, the French CAC 40 Index and the German DAX Index jumped by 1.2 percent and 1.3 percent, respectively.

Crude oil futures settled higher on Friday as recession fears faded a a bit amid hopes global central banks will announce further stimulus to revive economic growth. WTI crude for September ended up $0.40 or about 0.7 percent to close at $54.87 a barrel.

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