The Japanese stock market is trading modestly higher on Wednesday with a slightly positive lead from Wall Street and the yen's decline against the U.S. dollar aiding sentiment to an extent. Renewed optimism about a solution to the Greek debt crisis and higher earnings forecast from Toyota Motor are also aiding the surge.
The benchmark Nikkei 225 index, which rose to a three-month high of 8,981 in early trades, is currently up 55.2 points or 0.6 percent at 8,972.7.
Steel, non-ferrous metals, insurance, marine transport, pulp & paper and rubber stocks opened on a bright note and are still mostly trading in positive territory. Construction, electric power, oil and manufacturing stocks are trading mixed.
Toyota Motor opened bid-only after the company upgraded its group net profit forecast for financial year 2011. The automobile stock is currently trading nearly 3 percent up over its previous closing price.
Among other stocks in the automobile space, Mazda Motor is up 4 percent, Suzuki Motor is up nearly 2.5 percent, Mitsubishi Motor is gaining 2.2 percent and Nissan Motor is up with a gain of 1.6 percent.
Among bank stocks, Mitsubishi UFJ Financial, Mizuho Financial, SMFG, Shizuoka Bank and Shinsei Bank are up 0.4 to 1.2 percent, while Aozora Bank, Bank of Yokohama and Chiba Bank are down with modest losses.
Elpida Memory is up nearly 10 percent on reports that the company may sell its plant in Hiroshima.
JFE Holdings, Kubota Corp., Mitsubishi Paper, Japan Tobacco, Nisshin Steel, Kobe Steel and Nippon Steel are up 3 to 4.8 percent.
Mitsui Mining, Sumitomo Metal Industries, Nippon Soda, Fast Retailing, Fuji Heavy Industries, Nippon Paper Group, Trend Micro, Panasonic Corp., Matsui Securities, Advantest and Konica Minolta are trading higher by over 2 percent.
Ebara Corp is down more than 7.5 percent. Furukawa Electric, Yokogawa Electric, Dentsu, Obayashi Corp., NEC Corp., Astellas Pharma and Nippon Light Metal are also trading notably lower.
On the economic front, Japan saw a current account surplus of 303.5 billion yen in December, down 74.7 percent on year, the Ministry of Finance said. That was well shy of forecasts for a surplus of 340.1 billion yen and a 71.2 percent annual contraction. It also follows the 138.5 billion yen surplus and the 85.5 percent decline on year in November.
The trade balance reflected a deficit of 145.8 billion yen - also missing forecasts for a shortfall of 135.0 billion yen following the 585.1 billion yen deficit in the previous month.
Exports were down 7.0 percent on year to 5.443 trillion yen, while imports climbed 9.8 percent on year to 5.689 trillion yen.
According to the data released by Bank of Japan, overall bank lending in Japan was up 0.7 percent on year in January at 396.734 trillion yen. That follows the 0.5 percent increase in December.
Including trusts, bank lending added an annual 0.6 percent to 459.176 trillion yen. That matched analyst expectations following the 0.4 percent gain in the previous month. Lending from foreign banks plummeted 28.9 percent on year to 2.246 trillion in January. That follows the revised 32.1 percent contraction in December.
In the currency market, the U.S. dollar traded in the upper 76 yen range in early deals in Tokyo. The yen is currently trading at 76.93 to the U.S. dollar.
Among other markets in the Asia-Pacific region, South Korea and Taiwan are trading notably higher. Australia, Hong Kong and Singapore are up marginally,while New Zealand and Shanghai are trading flat. Markets across the region ended on a mixed note on Tuesday.
On Wall Street, stocks recovered after early weakness and ended modestly higher on Tuesday. While the Nasdaq briefly dipped into the red in late day trading, the major averages all closed in positive territory. The Dow rose 33.1 points or 0.3 percent to 12,878.2, the Nasdaq edged up 2.1 points or 0.1 percent to 2,904.1 and the S&P 500 climbed 2.7 points or 0.2 percent to 1,347.1.
Major European markets ended on a mixed note on Tuesday. While the French CAC 40 index edged up by 0.2 percent, the U.K.'s FTSE 100 index closed just below the unchanged line and the German DAX index drifted down by 0.2 percent.
U.S. crude oil futures closed higher on Tuesday amid reports of some progress in the Greek austerity measures and on a weak dollar. Light sweet crude for March delivery gained $1.50 or 1.6 percent to settle at $98.41 a barrel on the New York Mercantile Exchange.
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