Japanese Market Significantly Higher

The Japanese stock market is significantly higher on Wednesday, extending the sharp gains in the previous session, with the benchmark Nikkei index back above the 28,700 level, following the broadly positive cues overnight from Wall Street, on easing of concerns about the impact of the coronavirus Omicron variant on global economic recovery.

Meanwhile, Japan's economy in the July-September period contracted deeper than initially estimated last quarter amid a summer surge in COVID-19 cases that triggered emergency restrictions.

The benchmark Nikkei 225 Index is up 295.13 points or 1.04 percent at 28,750.73, after touching a high of 28,835.01 earlier. Japanese stocks closed sharply higher on Tuesday.

Market heavyweight SoftBank Group is edging up 0.3 percent and Uniqlo operator Fast Retailing is gaining more than 1 percent. Among automakers, Honda is edging down 0.4 percent and Toyota is losing more than 1 percent.

In the tech space, Screen Holdings is gaining almost 2 percent, while Advantest and Tokyo Electron are adding more than 2 percent each.

In the banking sector, Sumitomo Mitsui Financial, Mitsubishi UFJ Financial and Mizuho Financial are gaining almost 1 percent each.

Among the major exporters, Panasonic is losing more than 1 percent, while Sony is gaining more than 2 percent and Canon is adding more than 1 percent. Mitsubishi Electric is flat

Among the other major gainers, Chugai Pharmaceutical is surging more than 6 percent, Taiyo Yuden is gaining more than 4 percent and Omron is adding almost 4 percent, while Nintendo and Minebea Mitsumi are up more than 3 percent each. Dentsu Group, Nitto Denko and Ricoh are advancing almost 3 percent each.

Conversely, Mitsui Fudosan is losing more than 3 percent, while Credit Saison and are declining almost 3 percent each.

In economic news, Japan's gross domestic product contracted an annualized 3.6 percent on year in the third quarter of 2021, the Cabinet Office said on Wednesday. That missed forecasts for a drop of 3.1 percent following the 2.0 percent increase in the second quarter. On a seasonally adjusted quarterly basis, GDP sank 0.9 percent, also missing forecasts for a drop of 0.8 percent after adding 0.4 percent in the three months prior.

The value of overall bank lending in Japan was up 0.6 percent on year in November, the Bank of Japan said on Wednesday - coming in at 577.074 trillion yen. That's down from 0.9 percent in October. Excluding trusts, bank lending was up an annual 0.5 percent to 500.885 trillion yen - slowing from 0.8 percent in the previous month. Lending from trusts rose 1.0 percent on year to 76.189 trillion yen, while lending from foreign banks sank 2.5 percent on year to 3.042 trillion yen.

Meanwhile, Japan posted a current account surplus of 1,018.7 billion in October, the Ministry of Finance said on Wednesday - down 39.4 percent on year. That missed expectations for a surplus of 1,308.5 billion yen following the 1,033.7 billion yen surplus in September. Exports were up 11.7 percent on year at 7,080.0 Billion yen and imports jumped an annual 28.3 percent to 6,913.2 billion yen for a trade surplus of 166.7 billion yen. The capital account showed a deficit of 5.4 billion yen, while the financial account had a deficit of 879.6 billion yen.

In the currency market, the U.S. dollar is trading in the mid-113 yen-range on Wednesday.

On Wall Street, stocks showed another strong move to the upside during trading on Tuesday following the rally seen to start the week. The major averages all moved sharply higher, with the tech-heavy Nasdaq posting a particularly strong gain.

The Nasdaq soared 461.76 points or 3 percent to 15,686.92, continuing to recover after ending last Friday's trading at its lowest closing level in well over a month. The Dow also jumped 492.40 points or 1.4 percent to 35,719.43, while the S&P 500 surged up 95.08 points or 2.1 percent to 4,686.75.

The major European markets also showed strong moves to the upside on the day. While the U.K.'s FTSE 100 Index jumped by 1.5 percent, the German DAX Index and the French CAC 40 Index soared by 2.8 percent and 2.9 percent, respectively.

Crude oil prices rose sharply on Tuesday, lifting the most active futures contracts to their highest settlement in two weeks amid rising optimism about the outlook for energy demand. West Texas Intermediate Crude oil futures for January surged $2.56 or 3.7 percent at $72.05 a barrel.

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