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Tokyo stocks up by break after growth data

Tokyo stocks rose Wednesday morning after data showed Japan’s economy expanded slightly more than expected in the first quarter to sidestep a recession.

The world’s number three economy grew 0.4 percent in January-March, preliminary figures from the Cabinet Office showed shortly before markets opened, beating forecasts.

“It’s definitely stronger than I expected,” Seiichiro Iwamoto, a senior fund manager at Mizuho Asset Management, told Bloomberg News.

“The environment abroad had deteriorated so it’s no surprise that exports were weak, but it is surprising that consumption was so strong.”

Tokyo’s benchmark Nikkei 225 index finished a seesaw morning 0.61 percent, or 100.75 points, higher at 16,753.55, building on gains in the previous two sessions. The broader Topix index of all first-section shares gained 0.77 percent, or 10.28 points, to 1,346.13.

Exporters were among the gainers as the dollar rose to 109.35 yen from 109.13 yen in New York, while energy stocks jumped with crude prices sitting at six-month highs near $50.

The growth reading, which followed a sharp contraction in the final quarter of last year, comes days after local media reported that Prime Minister Shinzo Abe wants to delay a planned sales tax hike next year over concerns it could damage the already fragile economy.

A consumption tax rise in 2014 — seen as key to helping pay down Japan’s enormous national debt — was blamed for ushering in a brief recession.

Energy explorer Inpex soared 6.77 percent to 895.1 yen and refiner JX Holdings advanced 1.54 percent to 434 yen.

Banking-linked firms also rose, with Mitsubishi UFJ Financial Group surging 5.13 percent to 530 yen, while rival Sumitomo Mitsui Financial Group was up 3.99 percent at 3,465 yen.

Toyota gained 1.33 percent to 5,607 yen and Sony jumped 1.97 percent to 2,920 yen.

 

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