Originally created 06/02/04

Tokyo stocks close up, dollar lower against yen



TOKYO -- Tokyo stocks rebounded Tuesday amid hope for sustained momentum in Japan's economic recovery, but concern that rising oil prices might depress global markets tempered gains. The U.S. dollar was lower against the Japanese yen.

The Nikkei Stock Average of 225 stocks closed up 60.39 points, or 0.54 percent, at 11,296.76 points. On Monday, the index fell 73.20 points, or 0.65 percent.

The dollar was quoted at 109.35 yen by late afternoon Tuesday, down 0.21 yen from late Monday but above the 109.27 yen it bought in New York.

On the stock market, investors bought retailers and other companies likely to benefit from strong consumer spending.

Supermarket chain Ito-Yokado rose 1.6 percent, telecom operator KDDI climbed 3.1 percent and real estate developer Mitsubishi Estate gained 1.3 percent.

The economy's recovery has largely been driven by exports to the United States, China and other Asian nations, but consumer spending at home has recently started to rise. Expectations that spending would rise further were bolstered by government data showing workers' total cash earnings rose in April for the first time in 10 months.

Analysts said the market's strength was notable because U.S. financial markets were closed Monday for the Memorial Day holiday.

"Given the limited presence of foreigners, stocks fared relatively well," said UFJ Tsubasa Securities strategist Seiki Orimi.

Major banks Mitsubishi Tokyo Financial, Mizuho and Sumitomo Mitsui also ended higher.

But concerns about rising oil prices capped gains.

Tokyo players want to see how U.S. stock markets will respond to rising oil prices, so the benchmark Nikkei will likely remain trapped in a narrow range this week, said Hiroshi Sato, a general manager at Cosmo Securities.

Crude oil futures on the New York Mercantile Exchange's Access screen-trade rose during Asian trading hours Tuesday following terrorist attacks in Saudi Arabia over the weekend. Light, sweet July crude oil futures touched a high of $40.80 a barrel - up 92 cents from Friday's close - before pulling back to $40.65.

The broader index of all issues on the Tokyo Stock Exchange's first section ended up 4.33 points, or 0.38 percent, at 1,144.27 points on Tuesday. The index fell 2.44 points, or 0.21 percent, on Monday.

In currencies, the euro rose to $1.2242 late Tuesday in Tokyo from $1.2225 late Monday. Against the yen, the euro rose to133.85 yen from 133.78 yen.

The yield on Japan's benchmark 10-year government bond rose to 1.5300 percent from 1.5200 percent late Monday. Its price fell 0.08 to 99.74 points.

On the Net:

Tokyo Stock Exchange: http://www.tse.or.jp