TOKYO (dpa-AFX) - The Japan stock market has climbed higher in five straight sessions, rallying more than 2,850 points or 4.3 percent in that span. The Nikkei 225 now sits just above the 66,360-point plateau and it's tipped to open to the upside again on Monday.
The global forecast for the Asian markets suggests mild upside as easing crude oil prices wrestle with rising treasury yields. The European and U.S. markets were mostly higher and the Asian bourses are expected to follow suit.
The Nikkei finished sharply higher on Friday following gains from the financial shares, technology stocks and automobile producers.
For the day, the index rallied 850.21 points or 1.30 percent to finish at 66,364.20 after trading between 65,639.62 and 66,410.27.
The lead from Wall Street is positive as the major averages opened higher on Friday, dipped briefly but then bounced solidly higher for the rest of the day.
The Dow jumped 478.62 points or 0.93 percent to finish at 51,828.62, while the NASDAQ gained 129.32 points or 0.48 percent to close at 27,068.72 and the S&P 500 added 39.28 points or 0.51 percent to end at 7,743.41. For the week, the NASFAQ jumped 2.1 percent, the S&P added 1.2 percent and the Dow rose 0.3 percent.
The strength that emerged on Wall Street came amid a significant pullback by the price of crude oil, which had surged over the two previous sessions. U.S. crude oil futures have tumbled by more than 2 percent on the day after spiking by 4.5 percent over the past two days.
The sharp pullback by crude oil prices came as traders reacted to the latest reports about a potential deal to end the prolonged conflict between the U.S. and Iran.
Overall buying interest was subdued, however, as treasury yields saw further upside after surging over the two previous sessions. The yield on the benchmark ten-year note pulled back off its highs of the session but still ended the day at its highest closing level since July 2007.
The continued advance by treasuries came as worries about the outlook for inflation have helped solidify expectations that the Federal Reserve will continue raising interest rates next month. CME Group's FedWatch Tool is currently indicating a 64.2 percent chance the Fed will raise rates by another quarter point at its late October meeting.
Closer to home, The Bank of Japan will release the minutes from its monetary policy meeting on July 30-31 later this morning. At the meeting, the B0J voted 8-1 to retain the interest rate at 1.00 percent after raising its benchmark rate by 25 basis points in June. In the Outlook for Economic Activity and Prices, the bank said there is risk of underlying inflation deviating upward above the 2 percent target.
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