Japanese shares rise as oil surge lifts energy-related stocks

TOKYO, April 3 (Reuters) - Japanese stocks rose on Monday, tracking Wall Street's strength at the end of last week, and buoyed by gains in energy-related shares as oil prices jumped after surprise output cuts by OPEC+. The Nikkei share average gained 0.39% to 28,149.89 by the midday break, while the broader Topix climbed 0.53% to 2,014.08. Wall Street rallied more than 1% on Friday and the Nasdaq notched its biggest quarterly percentage gain since June 2020, as signs of cooling inflation bolstered hopes that the Federal Reserve might soon end its aggressive interest rate hikes. In Japan, energy explorers jumped 4.96% to lead gains in the Tokyo Stock Exchange's 33 industry sub-indexes.

Oil prices jumped about $5 a barrel, jolted by a surprise announcement by OPEC+ to cut production further in an effort to support market stability. Inpex jumped 5.51%. Engineering firm JGC Holdings surged 6.52% to become the top gainer on the Nikkei.

Oil refiners advanced 3.73%. The Nikkei's recent rally comes after the declines last month, when investors hedged against risks of a possible global financial crisis, said Makoto Kikuchi, chief executive officer at Myojo Asset Management. The Nikkei has rebounded from a near-two month low on March 16 as worries about a financial crisis eased. But rising borrowing costs could affect financing for low-rated companies in the U.S. and Europe, which could lead to an economic slowdown, said Kikuchi. "If that happens, Japanese companies would be affected," he said. Meanwhile, heavyweight chip-related firms fell, capping the Nikkei's gains. Advantest lost 4.03% to become the worst performer on the Nikkei. Tokyo Electron lost 2.28% and Screen Holdings fell 2.58%.
(Reporting by Junko Fujita; Editing by Subhranshu Sahu)

Reuters

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Japanese shares rise as oil surge lifts energy-related stocks

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