TOKYO (Thomson Financial) - Japanese shares were slightly higher in early trade on Tuesday amid uncertainties about the global economy and the Japanese political situation after Prime Minister Yasuo Fukuda announced his resignation late last night.
Local investors are expected to exercise caution, waiting to see how foreign investors react to the surprise announcement which may bring about a policy vacuum in the Japanese political scene following the Labour Day holiday in the United States.
U.S. markets were closed on Monday for the public holiday.
Ruling Liberal Democratic Party Secretary-General Taro Aso is now seen as a strong candidate to succeed Fukuda.
'Even if Aso comes to power, it is quite likely that it will only be an interim government, so this will be difficult for the stock market to digest,' said Tsuyoshi Segawa, equity strategist at Shinko Securities.
Economic concerns may also cap gains on the stock market, with trading likely to be light this week ahead of the release of major economic data including U.S. non-farm payroll data on Friday.
'But the news could be good in a sense as it reminded us of some hope for a change from the current standstill in Japanese politics,' said Mitsushige Akino, chief fund manager at Ichiyoshi Management.
Former Defense Minister Yuriko Koike may run for the top position, and because she has a similar policy line to that of reform-minded former Prime Minister Junichiro Koizumi, overseas investors may welcome her, Akino said.
At 0033 GMT, the Nikkei 225 Stock Average was up 2.24 points or 0.02 percent at 12,836.42. The broader Topix had gained 0.55 points or 0.04 percent to 1,231.19.
Early gainers included rubber products and non-life insurance stocks. Tire maker Bridgestone gained 3.8 percent to 1,887 yen, while Mitsui Sumitomo Insurance rose 2.3 percent to 3,530 yen.
Sharp Corp rose 1 percent to 1,369 yen after the consumer electronics maker said on Monday it aims to quadruple sales of home appliances to 1 trillion yen ($9.2 billion) by the year ending in March 2013, making them an earnings pillar along with LCD display and solar cell operations.
($1=108.12 yen)
masami.hachisu@thomsonreuters.com - hm/ng/hm/ng COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
Local investors are expected to exercise caution, waiting to see how foreign investors react to the surprise announcement which may bring about a policy vacuum in the Japanese political scene following the Labour Day holiday in the United States.
U.S. markets were closed on Monday for the public holiday.
Ruling Liberal Democratic Party Secretary-General Taro Aso is now seen as a strong candidate to succeed Fukuda.
'Even if Aso comes to power, it is quite likely that it will only be an interim government, so this will be difficult for the stock market to digest,' said Tsuyoshi Segawa, equity strategist at Shinko Securities.
Economic concerns may also cap gains on the stock market, with trading likely to be light this week ahead of the release of major economic data including U.S. non-farm payroll data on Friday.
'But the news could be good in a sense as it reminded us of some hope for a change from the current standstill in Japanese politics,' said Mitsushige Akino, chief fund manager at Ichiyoshi Management.
Former Defense Minister Yuriko Koike may run for the top position, and because she has a similar policy line to that of reform-minded former Prime Minister Junichiro Koizumi, overseas investors may welcome her, Akino said.
At 0033 GMT, the Nikkei 225 Stock Average was up 2.24 points or 0.02 percent at 12,836.42. The broader Topix had gained 0.55 points or 0.04 percent to 1,231.19.
Early gainers included rubber products and non-life insurance stocks. Tire maker Bridgestone gained 3.8 percent to 1,887 yen, while Mitsui Sumitomo Insurance rose 2.3 percent to 3,530 yen.
Sharp Corp rose 1 percent to 1,369 yen after the consumer electronics maker said on Monday it aims to quadruple sales of home appliances to 1 trillion yen ($9.2 billion) by the year ending in March 2013, making them an earnings pillar along with LCD display and solar cell operations.
($1=108.12 yen)
masami.hachisu@thomsonreuters.com - hm/ng/hm/ng COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2008 AFX News
