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Tokyo stocks rebound after 3-day loss, capped by US recession fears

This file photo shows the Tokyo Stock Exchange. (Mainichi)

TOKYO (Kyodo) -- Tokyo stocks ended higher Monday as investors sought battered shares after the market's three-day losing streak, but advances were limited amid growing fears over a U.S. economic recession following weak manufacturing data.

    The 225-issue Nikkei Stock Average ended up 218.19 points, or 0.84 percent, from Friday at 26,153.81. The broader Topix index finished 24.67 points, or 1.34 percent, higher at 1,869.71.

    On the top-tier Prime Market, gainers were led by electric and gas, mining and wholesale trade issues.

    The U.S. dollar remained weak mostly in the lower 135 yen range after disappointing economic data fueled fears of a recession in the United States and led to a decline in U.S. Treasury yields, dealers said.

    At 5 p.m., the dollar fetched 135.44-46 yen compared with 135.17-27 yen in New York and 135.30-32 yen in Tokyo at 5 p.m. Friday.

    The euro was quoted at $1.0430-0432 and 141.27-31 yen against $1.0422-0432 and 141.07-17 yen in New York and $1.0445-0447 and 141.32-36 yen in Tokyo late Friday afternoon.

    The yield on the benchmark 10-year Japanese government bond edged up 0.005 percentage point from Friday's close to 0.220 percent, with investors selling the safe-haven debt as risk appetite increased following the rise in Tokyo stocks. Bond yields move inversely to prices.

    Stocks were higher from the outset, with the Nikkei index briefly gaining more than 300 points in the morning on bargain-hunting after the benchmark lost more than 1,000 points over the previous three trading days.

    But the market remained top-heavy throughout the day, with the benchmark briefly dipping below the 26,000 threshold on concerns over the U.S. economy and a possible recession.

    U.S. manufacturing data from the Institute for Supply Management, released Friday, weighed on sentiment after showing a decline to 53.0 in June from 56.1 a month earlier, its lowest level since June 2020 and below the 54.9 market consensus.

    "Focus is starting to switch from whether the United States will fall into a recession, to a matter of when it will happen and how long it may last," said Yutaka Miura, senior technical analyst at Mizuho Securities Co., adding weak U.S. stock futures limited the market's climb.

    Investors are watching for a slew of economic indicators throughout the week, including U.S. jobs data for June to be released on Friday, he added.

    Among Prime Market issues, advancing issues outnumbered decliners 1,515 to 286, while 37 ended unchanged.

    Shionogi advanced 103 yen, or 1.5 percent, to 6,837 yen, after the pharmaceutical maker said the same day it was preparing to apply for approval of its COVID-19 drug in China.

    Askul gained 23 yen, or 1.5 percent, to 1,596 yen, after the office supply delivery service announced Friday a record net profit for the year ended in May.

    Bucking the upward trend, KDDI dropped 72 yen, or 1.7 percent, to 4,241 yen, following a network disruption in its services beginning Saturday that affected up to 39.15 million mobile connections.

    Trading volume on the Prime Market fell to 1,097.79 million shares from Friday's 1,349.73 million.

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