Japanese shares settle higher on U.S.-China trade deal optimism, weaker yen

By Tomo Uetake
TOKYO, Jan 14 (Reuters) - Japanese shares rose to four-week
closing highs on Tuesday as markets resumed trading after a long
weekend, with signs of goodwill between Beijing and Washington
supporting risk assets ahead of the expected signing of a Phase
1 U.S.-China trade deal.
The Nikkei share average .N225 advanced 0.7% to 24,025.17,
its highest close since Dec. 17, while the broader Topix .TOPX
added 0.3% to 1,740.53, also its four-week high.
The U.S. Treasury Department on Monday said China should no
longer be designated a currency manipulator - a label it applied
as the yuan slid in August. The yen plumbed a near eight-month low versus the dollar of
110.22 yen JPY= , providing a tailwind for Japanese exporters
as a weak local currency boosts corporate profits when they are
repatriated, while the yuan climbed to its highest since July.
The announcement came as a high-level Chinese delegation
arrived in Washington ahead of the signing of trade agreement on
Wednesday aimed at easing tensions between the two countries.
Tokyo-listed blue-chip exporters Sony Corp 6758.T climbed
2.5%, Panasonic Corp 6752.T rose 1.7% and Tokyo Electron
8035.T added 1.9%.
Among other gainers, SoftBank Group Corp 9984.T and Fast
Retailing 9983.T , the Nikkei's top two heavyweights, rose 3.5%
and 2.2%, respectively, on futures buying.
Aeon 8267.T advanced 2.6% after the retail giant announced
the first change in its top leadership in 23 years.
Bucking the overall trend, Nissan Motor 7201.T shed 3% to
hit its lowest level in 8-1/2-years, a day after Renault shares
RENA.PA hit six-year lows on worries that the French group's
20-year cost-sharing alliance with Nissan was headed for a
break-up without Carlos Ghosn. Elsewhere, Ryohin Keikaku 7453.T dived 19% after the
operator of Muji stores forecast its net profit for the
financial year ending February to fall 25.8%, worse than
expected. "The market is now waiting for a new catalyst, other than an
expected Phase 1 U.S.-China trade deal, which has already been
priced in," said Masahiro Ichikawa, senior strategist at
Sumitomo Mitsui DS Asset Management.