Japan's Nikkei bounces back as fears about Italy recede
TOKYO, May 31 (Reuters) - Japan’s Nikkei share average on Thursday bounced back from a six-week low as worries over Italy’s political crisis receded.
The Nikkei rose 0.83 percent to 22,201.82. On Wednesday, it hit 21,931.65, the lowest since April 18.
While mining, auto and drug shares outperformed, shippers and air carriers fell.
Japan Petroleum Exploration jumped more than 5 percent after Mitsubishi UFJ Morgan Stanley Securities raised its stock rating.
Toyota Motor gained 1.17 percent and Honda Motor rose 0.85 percent. Mitsui OSK Lines dropped 1.1 percent and Japan Airlines shed 1.6 percent.
Japanese stocks sank earlier this week in line with global equity markets as fears about instability in Italy and the possibility of its exit from the euro sent investors piling into safety assets.
But stocks rebounded overnight after Italy’s 5-Star Movement made a renewed attempt to form a coalition government and called for euroskeptic Paolo Savona to withdraw his candidacy as economy minister.
However, traders said that gains may be short-lived as negative factors for Japanese stocks such as a stronger yen are likely to keep activity in check.
“Investors are nervous about the stronger yen, so they probably won’t chase the market higher,” said Yutaka Miura, a senior technical analyst at Mizuho Securities.
The broader Topix added 0.65 percent to 1,747.45. ($1 = 108.6100 yen) (Reporting by Ayai Tomisawa and the Tokyo markets team; Editing by Richard Borsuk)