Tokyo stocks rose Monday morning, following the advance of the U.S. Dow Jones Industrial Average late last week on hopes for an earlier-than-expected interest rate cut amid signs of cooling inflation in the world's largest economy.
The 225-issue Nikkei Stock Average rose 361.75 points, or 0.94 percent, from Friday to 38,849.65. The broader Topix index was up 22.91 points, or 0.83 percent, at 2,795.40.
The U.S. dollar was little changed in the lower 157 yen zone amid caution about a yen-buying intervention by Japanese authorities after the government said Friday it had spent a monthly record of 9.8 trillion yen between April and May to slow the yen's rapid fall, dealers said.
At noon, the dollar fetched 157.23-25 yen compared with 157.19-29 yen in New York and 157.14-15 yen in Tokyo at 5 p.m. Friday.
The euro was quoted at $1.0852-0856 and 170.63-71 yen against $1.0844-0854 and 170.56-66 yen in New York and $1.0822-0823 and 170.06-10 yen in Tokyo late Friday afternoon.
A broad range of issues drew buying, briefly sending the Nikkei index up over 500 points, after U.S. data showed Friday a year-on-year inflation index in April was unchanged from the previous month, matching market expectations.
"Shares rose as U.S. inflation concerns eased," said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co. "Some investors who initially expected the Federal Reserve to cut rates in November now project that the move could come as early as September."
