By Osamu Tsukimori, CBS MarketWatch.com
TOKYO (CBS.MW) - Tokyo stocks rose for a second day Friday as investors flooded into consumer cyclicals such as retailer Ito-Yokado on signs of a strengthening Japanese economy. Companies that reported improved results such as Internet investor Softbank saw gains, as well as DoCoMo amid a bidding war for AT&T Wireless.
The Nikkei Average ended up 98 points, or 0.9 percent, at 10,557.69, while the broader Topix rose 10 points, or 1 percent, to 1,041.03.
Other Asian bourses were mixed amid mild losses on Wall Street.
The dollar edged up to 105.39 yen in late Friday Tokyo from 105.35 yen late Thursday New York levels after Fed Chairman Alan Greenspan reiterated in congressional testimony that he saw no urgency in raising rates.
"The market is looking for fresh data after Fed Chairman Greenspan on Thursday basically repeated the same message," said Masaki Fukui, vice president of the forex division at Mizuho Corporate Bank. "My focus is on Japan's GDP numbers next week. My guess is that the expected strong numbers in Japan's GDP could push the yen higher."
In the United States, the Dow Jones Industrial Average fell 0.4 percent, while the Nasdaq Composite lost 0.8 percent. The U.S. market will be closed Monday for a national holiday.
In Japan, technology stocks such as Canon and Tokyo Electron rose, but large investors concerned about the Nasdaq's recent performance were seen reducing their weightings on high-priced high-tech issues, said Norihiro Fujito, senior investment strategist at Mitsubishi Securities.
"It seems as though that amid wariness over the yen's appreciation (beyond 105 yen), investors are beginning to shift their investments to domestic demand-related issues," said Fujito, pointing out gains for real-estate and construction issues.
Mitsubishi Estate /zigman2/quotes/208166463/delayed MITEF +2.61% soared 4.2 percent to 1,205 yen and property stock Daiwa House /zigman2/quotes/200044555/delayed DWAHY -1.13% jumped 6.1 percent to 1,087 yen.
Retailer Ito-Yokado jumped 3.1 percent to 3,680 yen and rival Aeon /zigman2/quotes/205819358/delayed AONNY +0.45% rose 2.9 percent to 3,580 yen.
Consumer cyclicals tend to benefit from signs of a pickup in the economy. On Thursday, Japan scored a trifecta on the economic front as machinery orders soared in December, wholesale prices stopped falling in January and it was reported that the current-account surplus hit a record last year. Read Japan economy.
Analysts expect the upward trend to continue next week when the Japanese government releases fourth-quarter gross domestic product data. The consensus forecast is for 4.5 percent to 4.7 percent annualized growth in the October-December quarter. Fujito said he expects GDP growth within that range, but said the market had already factored that into current prices. "The market won't react unless there's a big surprise," he said.
Another stock in focus was NTT DoCoMo , which soared 2.3 percent to 224,000 yen after the Nihon Keizai newspaper reported the mobile phone giant has decided not to buy AT&T Wireless due to an estimated 3 trillion yen ($28.5 billion) price tag. Read full story.
Rival KDDI /zigman2/quotes/209186068/delayed KDDIF -5.74% surged 5.9 percent to 589,000 yen. Shipments of mobile phones soared 27.4 percent in 2003 from a year earlier to a record 50.8 million units, the Japan Electronics and Information Technology Industries Association said.