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Japanese Market Modestly Higher

Japanese stock market is modestly higher after recouping early losses on Monday, with the Nikkei 225 above the 29,700 level, on strong local trade data and broadly positive cues from Wall Street on Friday. However, traders continue to be worried about the rising coronavirus cases and the possible restrictions on economic activity.

The country is considering stricter Covid-19 measures after the nationwide tally surpassed 4000 for a 5th consecutive day on Sunday. Tokyo Governor Yuriko Koike said she might issue a fresh state of emergency for the capital to deal with a recent spike in coronavirus cases.

There are also reports of the possibility of canceling the Tokyo Olympics after the western metropolis of Osaka reported over 1,200 new infections Thursday, the highest since the pandemic began.

The benchmark Nikkei 225 Index is gaining 62.31 points or 0.21 percent to 29,745.68, after hitting a low of 29,530.84 earlier. Japanese shares ended marginally higher on Friday.

Market heavyweight SoftBank Group is edging down 0.5 percent and Uniqlo operator Fast Retailing is declining almost 2 percent. Among automakers, Honda is flat and Toyota is edging down 0.4 percent.

The major exporters are mixed. Panasonic is edging down 0.2 percent and Sony is losing almost 1 percent, while Canon and Mitsubishi Electric are edging up 0.2 percent each.

In the tech space, Advantest and Tokyo Electron are gaining more than 1 percent each. In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are edging down 0.5 percent each, while Mizuho Financial is losing more than 1 percent.

Among the other major gainers, Sumco is gaining more than 4 percent, Mitsui OSK Lines is up almost 4 percent and Kawasaki Kisen Kaisha is adding almost 3 percent. Alps Alpine, Seiko Epson, Sumitomo Osaka Cement and Taiheiyo Cement are rising about 2 percent each.

Conversely, Ebara is losing more than 3 percent, while Toho, Shiseido, Japan Exchange Group, Keisei Electric Railway and Daiwa House Industry are down more than 2 percent each.

In economic news, Japan posted a merchandise trade surplus of 663.7 billion yen in March, the Ministry of Finance said on Monday. That exceeded expectations for a surplus of 490.0 billion yen following the downwardly revised 215.9 billion yen surplus in February (originally 217.4 billion yen). Exports jumped 16.1 percent on year to 7.378 trillion yen, beating forecasts for an increase 11.6 percent following the 4.5 percent decline in the previous month. Imports gained an annual 5.7 percent to 6.714 trillion yen versus expectations for 4.7 percent following the 11.8 percent increase a month earlier.

In the currency market, the U.S. dollar is trading in the higher 108 yen-range on Monday.

On Wall Street, stocks moved mostly higher over the course of the trading day on Friday to extend the rally seen in the previous session. With the continued upward move, the Dow and the S&P 500 once again set new record closing highs.

The Dow climbed 164.68 points or 0.5 percent to 34,200.67 and the S&P 500 rose 15.05 points or 0.4 percent to 4,185.47. Meanwhile, the tech-heavy Nasdaq posted a more modest gain, inching up 13.58 points or 0.1 percent to 14,052.34.

The major European markets also moved to the upside on the day. While the German DAX Index surged up by 1.3 percent, the French CAC 40 Index jumped by 0.9 percent and the U.K.'s FTSE 100 Index rose by 0.5 percent.

Crude oil prices drifted lower on Friday, snapping a four-session winning streak but still finishing sharply higher for the week. West Texas Intermediate Crude oil futures for May were down $0.33 or 0.5 percent at $63.13 a barrel, although the contract gained nearly 6.5 percent in the week.

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