Company News

CORRECTED-Nikkei jumps to 29-year high, Honda leads carmakers on upbeat earnings

(Corrects Topix close in fourth paragraph to 1,681.90, not 1,6781.90)

TOKYO, Nov 9 (Reuters) - Japan’s Nikkei share average on Monday reached a high last seen almost three decades ago, after Joe Biden clinched the U.S. presidency, with Honda Motors leading gains among carmakers on strong earnings figures.

Investors, who had held off purchases last week due to U.S. political uncertainty, rushed to buy as they focused on Biden’s ability to expand fiscal stimulus and measures to reduce the spread of COVID-19.

The Nikkei rose 2.12% to 24,839.84, its highest close since November 1991, adding 8.1% in the last five sessions of gains.

The broader Topix rose 1.41% to 1,681.90, a level last seen in late February.

Honda Motor gained 9.4% after the carmaker posted strong quarterly earnings and raised its earnings outlook.

Toyota Motor Corp, which announced its earnings on Friday, extended gains by 2.2%, though Mazda Motor bucked the trend by falling 2.9% after announcing disappointing earnings results.

The transport equipment maker index gained 2.4%.

“Corporate earnings are recovering more than expected. It also means a lot for the Japanese market that car makers are showing a strong recovery,” said Takuya Hozumi, a global investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

“In addition, Eastern Asian shares, including Japan, were helped by the relatively contained level of coronavirus infections.”

Sushiro Global jumped 15.2% after the sushi restaurant chain operator reported a better-than-expected profit for the July-September quarter, recovering from a slump triggered by the epidemic in the preceding quarter.

Renewable energy-related firms also soared following Biden’s victory. Renova gained 6.4%, West Holdings added 3.4% and Erex rose 13.2%.

On the other hand, Japan Airlines fell 11% after the company unveiled its plans to sell new shares to raise about $1.6 billion. Rival ANA also felt the heat and dropped 1.9%.

Eisai dived 23.6% after a panel to the U.S. health regulator voted that a potential Alzheimer’s treatment from the firm and Biogen Inc has not been proven to slow progression of the disease. (Editing by Sherry Jacob-Phillips and Subhranshu Sahu)