Nikkei closes 0.3% higher; Japan shares edge up as US jobs data eases Fed taper concerns

TOKYO: Japanese shares closed higher on Monday after US jobs data eased concerns over an early tapering from the Federal Reserve, but heavy profit-taking capped gains amid caution before US inflation readings due later this week.

The Nikkei share average edged up 0.27 per cent to close at 29,019.24, after rising as high as 1 per cent to reach a nearly four-week high earlier in the session.

The broader Topix reversed course to tick up 0.08 per cent to 1,960.85.
The US economy added 559,000 nonfarm payrolls in May, data showed on Friday, below economists' forecast of 650,000, reducing expectations of an early tapering in the Fed's asset purchase.

However, investors remain cautious as they look for more clues on possible tapering from the US consumer price index (CPI) report this week, said Takatoshi Itoshima, strategist at Pictet Asset Management.

"Investors want to confirm whether there are risks for inflation from the CPI report," said Itoshima.

Friday's gain in the Nasdaq index boosted Japanese tech stocks, with electronic parts makers Ibiden rising 3.51 per cent and TDK Corp adding 2.34 per cent.

Shippers benefited from global bullish sentiment, rising 2.55 per cent to a 10-year peak, with Nippon Yusen rising 2.37 per cent, Kawasaki Kisen jumping 5.51 per cent and Mitsui OSK Lines adding 2.26 per cent.

However, profit-taking sank steelmakers, which had risen sharply this year on signs of a global recovery.

The steelmaker subindex dropped 4.71 per cent, with Nippon Steel losing 5.74 per cent, JFE Holdings shedding 7.2 per cent and Kobe Steel falling 5.2 per cent.

Hospitality shares, which had gained on Japan's accelerated vaccine roll-outs, also lost traction, with department store operator Takashimaya dropping 1.84 per cent and Isetan Mitsukoshi edging down 1.27 per cent.