Nikkei snaps 7-day losing streak helped by China's stimulus hopes

  • Reuters
  • Stock Market News
Nikkei snaps 7-day losing streak helped by China's stimulus hopes
Credit: © Reuters.

* Gains may be short-lived - analyst

* Takeda Pharma, Nissan sink after earnings shock

* Mitsubishi Estate jumps on share buyback, governance reform

By Hideyuki Sano and Ayai Tomisawa

TOKYO, May 15 (Reuters) - Japan's Nikkei ended higher in choppy trade on Wednesday, snapping a seven-day losing streak, as expectations that China could roll out fresh stimulus to prop up a slowing economy supported stocks in the region.

The Nikkei share average .N225 ended 0.6% higher at 21,288.56, after trading in negative territory in the morning. It had dropped for seven straight days.

The broader Topix .TOPX , which hit a four-month low the previous day, rose 0.6% to 1,544.15.

"The market turned around on hopes that China will launch stimulus measures to tackle the weak economy, but the gains may be short-lived as it was just hopes at this point," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

U.S. futures ESc1 also rose 0.2% indicating a positive open for U.S. stocks later in the day.

Exporters gained with Sony Corp 6758.T up 4%, Subaru Corp 7270.T rising 2.7% and Hitachi Ltd 6501.T 2.6% higher.

Meanwhile, Japanese corporate earnings disappointed the market, with net profits falling almost 5.0% from a year earlier in January-March, according to Okasan Securities.

Takeda Pharmaceutical 4502.T plunged 7.8% after Japan's biggest drugmaker forecast an unexpected operating loss for the current year due to costs associated with the $59 billion purchase of Shire Plc (LON: SHP ). weighed on Tokyo Stock Exchange's drugmaker subindex .IPHAM.T 3%, making it the worst performer.

Nissan Motor 7201.T slumped 6.5% after the carmaker forecast the weakest profit outlook in more than a decade.

"The earnings results suggested that the company is in much worse shape than I have imagined," said Hiroshi Masushima, market analyst at Monex Securities.

The carmaker, hit by former chairman Carlos Ghosn's arrest last year and troubles at its North American business, also said its dividend will be cut about 30% in another blow to investors as its hefty payouts have been the only major attraction.

H2O Retailing 8242.T stumbled 11% as the mid-tier department store operator posted weak earnings and guidance.

On the upside, Mitsubishi Estate 8802.T jumped 9.2% after the real estate developer announced its first share buyback and a plan to abolish anti-takeover steps. (Editing by Sam Holmes)

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