Tokyo shares rebound after Monday sell-off

Tokyo stocks rebounded Tuesday after investors aggressively sold shares in the previous session following hawkish comments from Fed chief Jerome Powell on his plan to continue hiking rates.

The benchmark Nikkei 225 index added 1.14 per cent or 316.62 points to 28,195.58 yen, while the broader Topix index rose 1.25 per cent, or 24.28 points, to 1,968.38.

Investors returned to buying in Tokyo despite overnight falls on Wall Street, Okasan Online Securities said in a note.

“The Nikkei lost more than 760 yen on Monday. For now, buying related to a natural rebound led the market,” the brokerage said.

A lower yen also helped exporter shares.

“The market to a degree has digested the downward pressure from the Powell shock,” Daiwa Securities said.

Natural resources stocks also gained as oil prices firmed.

The dollar fetched 138.49 yen in Asian trade, against 138.73 yen in New York late Monday -- higher than the 136.82 yen during pre-Powell speech hours in Tokyo on Friday.

Among major shares, Olympus advanced 2.50 per cent to 3,033 yen after it said it would sell its microscope unit to US private equity firm Bain Capital for 427.7 billion yen ($3 billion).

NEC soared 5.97 per cent to 5,060 yen after the IT conglomerate said it would buy back up to 2.46 per cent of shares for 30 billion yen.