Nikkei gains for 5th day; oil shares, chip equipment firms rally

  • Reuters
  • Stock Market News
Nikkei gains for 5th day; oil shares, chip equipment firms rally
Credit: © Reuters.

* Nikkei's immediate resistance level seen at 23,000 - analyst

* Oil stocks, chip equipment makers attract buying

* Defensive utility, food stocks underperform

* Line soars after broker's upgrade

By Ayai Tomisawa

TOKYO, July 19 (Reuters) - Japan's Nikkei share average gained on Thursday, hovering at a one-month high thanks to a softer yen as well as strong demand for energy, mining and chip equipment makers, though investors were wary of bidding up prices across-the-board given the recent rally.

Oil shares jumped after the Nikkei business daily reported that Japanese oil distributors are preparing to suspend imports of Iranian crude oil in line with U.S. demands, stoking speculation the move would lift procurement costs and bump up oil prices.

The oil .IPETE.T and mining .IMING.T sectors were the best performers on the board, with Idemitsu Kosan 5019.T surging 5.2 percent, Showa Shell (LON: RDSa ) 5002.T rallying 4.7 percent and Cosmo Energy 5021.T advancing 4.7 percent. Inpex 1605.T rose 4.6 percent.

The Nikkei .N225.T climbed 0.4 percent to 22,894.62 in midmorning trade for its fifth day of gains. The benchmark index hit 22,949.32 on Wednesday, the highest level since June 13.

The dollar rose to more than a six-month high of 113.14 yen JPY= in the previous session, before shedding 0.1 percent at 112.71 yen.

"The Nikkei's level of 23,000 has become its immediate resistance level, and when the index nears this level, profit-taking occurs," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

Chip equipment makers gained ground after ASML Holding NV ASML.AS , a supplier of equipment to the world's biggest computer chipmakers, reported forecast-beating second-quarter results. Corp 6857.T soared 3.6 percent and Tokyo Electron 8035.T added 3.0 percent.

Messaging app operator Line Corp (NYSE: LN ) 3938.T soared 4.3 percent after UBS Securities raised its stock rating to 'buy' from 'neutral,' saying that its mobile payment transaction business will likely lead its growth.

Defensive sectors such as utility and food lost ground. Tokyo Gas 9531.T shed 2.3 percent and Osaka Gas 9532.T declined 1.3 percent.

Brewer Asahi Group Holdings 2502.T dropped 1.8 percent and soy sauce maker Kikkoman Corp 2801.T fell 1.6 percent.

The broader Topix .TOPX added 0.3 percent to 1,757.04. (Editing by Shri Navaratnam)

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