Tokyo stocks extend gains in morning encouraged by buying on weak yen

Tokyo stocks extended gains Monday morning, with the Nikkei index hitting a fresh 10-month intraday high, as accelerated yen weakness prompted buying, particularly in export-linked names.

The 225-issue Nikkei Stock Average gained 87.82 points, or 0.49 percent, from Friday to 18,055.23. The broader Topix index of all First Section issues on the Tokyo Stock Exchange added 10.67 points, or 0.75 percent, to 1,439.13.

The U.S. dollar breached the 111 yen line Monday morning, marking the first time in six months the yen has retreated that far against the greenback, as markets believe U.S. President-elect Donald Trump will pursue fiscal stimulus measures to bolster America's growth, which encouraged investors here to pile into a swathe of issues and giving the market's key exporter sector a significant lift.

A weak yen boosts the value of exporters as their profits are augmented in overseas markets when the yen is weak and the yields are repatriated, and their competition is also enhanced when the exchange rates are favorable.

The dollar as of noon was trading at 110.97-98 yen compared with 110.87-97 yen in New York and 110.70-71 yen at 5 p.m. on Friday in Tokyo.

Notable gainers by the morning break comprised insurance, mining and export-related electronics issues. Endit