July 15, 2020 / 2:49 AM / 21 days ago

Japan stocks hit 5-week high on hopes of virus drug, economic growth

TOKYO, July 15 (Reuters) - Japanese stocks rose on Wednesday to a five-week peak as encouraging results from a coronavirus vaccine study and optimism about swift economic growth supported expectations that corporate earnings will pick up in the second half of the year.

The Nikkei index rose 1.4% to 22,902.10 by 0157 GMT. The index briefly climbed to the highest since June 10, with industrial and consumer discretional shares leading the advance.

Sentiment for Japanese equities and other risky assets got a boost on Wednesday after U.S. biotech firm Moderna Inc said its experimental coronavirus vaccine showed it was safe in an early-stage study.

Recent data from many major economies have also shown signs that corporate activity and consumer spending are recovering from sharp declines in the first half of the year caused by the coronavirus pandemic.

Meanwhile, new COVID-19 cases are slowly rising in Japan. The situation is worse in the United States, where infections and deaths are hitting record highs on a daily basis.

Investors, however, are looking past these developments as they focus on expectations for better medical treatments and continued economic growth.

There were 209 advancers on the Nikkei index against 15 decliners.

The largest percentage gainers in the index were automaker Nissan Motor Co Ltd up 7.1%, followed by steel manufacturer JFE Holdings Inc gaining 5.88%, and plant engineering company JGC Holdings Corp up by 5.46%.

The largest percentage losses in the index were pharmaceutical company Eisai Co Ltd down 1.93%, followed by drugs maker Kyowa Kirin Co Ltd losing 1.06%, and semiconductor testing equipment maker Advantest Corp down by 1.03%.

The broader TOPIX index rose 1.34% to 1,585.71.

The volume of shares traded on the Tokyo Stock Exchange’s main board 0.53 billion, compared with the average of 1.3 billion in the past 30 days. (Editing by Sherry Jacob-Phillips)

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