Roundup: Tokyo stocks surge as U.S. shares' rally after Trump's win lifts mood, yen eases

Tokyo stocks surged Thursday recouping all the losses a day earlier in a woeful day of trading, as U.S. shares' rally after Donald Trump's victory in the U.S. presidential election, bolstered the market mood and encouraged spending.

The 225-issue Nikkei Stock Average surged 1,092.88 points, or 6.72 percent, from Wednesday to close the day at 17,344.42, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange jumped 75.19 points, or 5.78 percent, to end at 1,376.35.

Local brokers said that the yen's retreat against the U.S. dollar brightened the market mood early on, particularly as a day earlier the yen's strength was key to a broad rout that saw Japan's key exporter issues take a hammering.

Traders here also said that following the turmoil after billionaire businessman Donald Trump winning the U.S. presidential election, with initial nerves rocking indices as investors were unsure of future U.S. political and economic policies, sentiment turned positive following a cordial winning speech by Trump and U.S. President Barack Obama's subsequent pledge to make his transition into office a peaceful one.

"It's very mysterious. Fear dominated the market first, then people looked at what's going to change from tomorrow. Nothing much and Mr. Trump's victory speech was not as hostile as before. So people calmed and regained some stability. One other thing is people learned a lot from the Brexit turmoil," said Toru Ibayashi, head of Japanese equity investments at UBS Group AG's wealth management unit in Tokyo.

Other analysts noted that despite all the vitriol in the election campaign, a Trump presidency could lead to policies that drive growth in the U.S. as well as see regulations eased in the financial sector, which sent respective issues here higher Thursday.

"The dust is gradually settling after the shock of Trump's victory as investors are digesting the implication of his presidency," said Maki Sawada, vice president of the investment research and investor services department at Nomura Securities Co., adding that along with promising tax cuts and infrastructure spending, hopes were growing for overall economic growth.

As such, banking issues here gained mirroring advances made on Wall Street overnight on hopes for eased regulations, and Mitsubishi UFJ Financial Group leapt 11.2 percent to 557 yen and Sumitomo Mitsui Financial Group jumped 8.6 percent to 3,643 yen.

The yen's retreat, meanwhile, gave exporters a lift, with Komatsu surging 10.7 percent to 2,413 yen and Honda Motor accelerating 9 percent to 2,980 yen.

Most notably comprising insurance, securities and banking-linked stocks, all industry categories closed in positive territory on the main section and on the First Section advancing issues battered declining ones by 1,935 to 48.

Trading volume on the main section fell to 3.20 billion shares from Wednesday's volume of 3.81 billion shares and the day's turnover was 3,412.5 billion yen (32.32 billion U.S. dollars). Endit