Tokyo Rebound Helps Australian Stocks

The Nikkei average’s close above 20,000 for the first time since Monday helped prop up Australian stocks, but other Asian markets slipped Thursday.

Tokyo shares rebounded on strong volume as expectations of a discount rate cut and official economy-boosting measures lightened the mood. But brokers said much of the strength was a technical reaction to recent falls.

“People feel it may be premature to say the worst is over, but they’re happy to see the market has the ability to absorb selling,” said Paul Migliorato of Jardine Fleming. “And getting back above 20,000 made them feel good as well.”

The 225-share Nikkei average ended up 420.78 points, or 2.13%, at 20,185.09. An estimated 550 million shares were traded.

The Tokyo stock and currency markets will be closed today for a holiday. Trading will resume Monday.

The three-day weekend sparked short covering in futures, which helped stocks as well, brokers said. Foreigners and newly opened investment trusts were among the buyers. They helped absorb selling from institutions ahead of the fiscal year-end.

In Australia, buyers pushed the market higher after the Nikkei’s gains.

The All Ordinaries average was up 3.4 points at 1,571.4.

“Buyers were not prepared to do anything until it was obvious there was no excess selling, then they stepped in, encouraged by a firmer Nikkei,” said a James Capel broker.

In Taipei, share prices finished lower as political worries sidelined many investors. Brokers said trade will remain slow in coming days. The weighted index ended down 41.72 points at 4,810.23.

Hong Kong’s blue chip Hang Seng index fell 45.58 points to 4,990.58.