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Japanese Market Extends Gains

The Japanese stock market is extending gains on Tuesday from the previous session following the positive cues overnight from Wall Street after a report showed U.S. manufacturing activity contracted at a slower rate in the month of May.

Optimism about the phased reopening of the Japanese economy lifted stocks. On Monday, the Tokyo Metropolitan Government entered the second phase of its three-part plan to gradually ease social distancing measures and allow businesses to reopen.

The benchmark Nikkei 225 Index is adding 192.52 points or 0.87 percent to 22,254.91, after touching a high of 22,294.52 earlier. Japanese shares hit a three-month high on Monday.

Market heavyweight SoftBank Group is rising more than 2 percent and Fast Retailing is adding almost 1 percent.

The major exporters are higher on a slightly weaker yen. Mitsubishi Electric is rising almost 3 percent, while Sony and Canon are rising almost 2 percent each and Panasonic is up almost 1 percent.

In the tech space, Advantest is declining almost 1 percent and Tokyo Electron is edging down 0.1 percent. Among automakers, Toyota is advancing almost 2 percent and Honda Motor is adding more than 1 percent.

In the oil sector, Inpex is rising almost 3 percent and Japan Petroleum is higher by more than 2 percent even as crude oil prices edged lower overnight.

Among the major gainers, IHI Corp. is gaining almost 6 percent, Mitsui E&S Holdings is rising more than 5 percent and NTN Corp. is higher by more than 4 percent.

On the flip side, Daiichi Sankyo is losing almost 4 percent and Kansai Electric Power is lower by almost 2 percent.

In the currency market, the U.S. dollar is trading in the mid 107 yen-range on Tuesday.

On Wall Street, stocks closed higher on Monday following the release of a report from the Institute for Supply Management showing U.S. manufacturing activity contracted at a slower rate in the month of May. The report from the ISM came on the heels of a private survey showing the Chinese manufacturing sector expanded in May. Traders remain generally optimistic about economies reopening despite political unrest across the country following the death of George Floyd, which has forced a number of major retailers to temporarily close their stores in areas hit hard by protests.

The Dow climbed 91.91 points or 0.4 percent to 25,475.02, the Nasdaq advanced 62.18 points or 0.7 percent to 9,552.05 and the S&P 500 rose 11.42 points or 0.4 percent to 3,055.73.

The major European markets also moved to the upside on Monday, although several major markets were closed for public holidays. The U.K.'s FTSE 100 Index and the French CAC 40 Index surged up by 1.5 percent and 1.4 percent, respectively.

Crude oil prices turned in a relatively lackluster performance on Monday before ending the session modestly lower. WTI crude for July delivery edged down $0.05 to $35.44 a barrel.

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