Roundup: Nikkei surges 2.07 pct on yen's weakness, hopes for ECB stimulus measures

The Nikkei stock index surged 2.07 percent Tuesday as a weaker yen lifted the market mood, supported also by speculation that the European Central Bank (ECB) will initiate new stimulus measures.

The Nikkei 225 climbed 352.01 points to end at 17,366.30, while the broader Topix index of all first-section shares added 1.84 percent, or 25.22 points, to finish at 1,397.63.

Market players here said the likelihood would be that the ECB will implement quantitative easing to tackle mounting deflation in the single currency eurozone, especially after the latest indicators revealed that consumer prices had marked a downward trajectory in December for the first time in five years.

"The yen is weakening on expectations for further stimulus measures from the ECB, which is supporting stocks. Also, if you exclude external factors for Japan, then expectations are high for good earnings results. It may not be enough to push the market higher, but it'll be a good support," said Tomomi Yamashita from Shinkin Asset Management Co.

Chinese economic data showed Tuesday that growth in the world's second-biggest economy beat economists' estimates in the October- December quarter, holding steady at 7.4 percent, as stimulus efforts have started to see demand return.

The news sent China related issues here higher Tuesday and contributed to a largely beat market mood.

In currency markets, the yen retreated to 118.30 versus the U.S. dollar and was changing hands at 136.98 to the euro, compared to 117.53 yen and 136.69 yen respectively, logged in London on Monday.

The yen's weakening saw exporter issues rise, as their companies rely on a weaker yen to boost profits made overseas when repatriated and to enhance their profit outlooks and overall competitiveness.

As such, Toyota accelerated 2.59 percent to close at 7,659 yen and Canon climbed 1.65 percent to finish the day at 3,850 yen.

Fujitsu also closed in positive territory Tuesday, leaping 4.2 percent to 628 yen, after the firm announced it will promote an " Asia-oriented" executive to become its president this summer.

Among China-linked shares that gained on the nation's robust economic data, Komatsu climbed 3.5 percent to 2,587 yen and industrial robotics maker and Nikkei heavyweight Fanuc advanced 3. 7 percent to finish the day at 19,910 yen.

But Itochu, a prominent trading house, was a notable decliner Tuesday, falling 2.5 percent to 1,207 yen, after reports it will, along with Thai agricultural firm Charoen Pokphand Group, buy a 10 percent stake in China's government-affiliated Citic investment corporation.

Trading volume on Tuesday rose to 2.13 billion shares on the Tokyo Exchange's First Section, up from Monday's volume of 2.03 billion shares, with advancing issues outnumbering declining ones by 1,657 to 158. Endi